BNP Paribas Job Cuts in China and Hong Kong

HONG KONG (Reuters) – France's BNP Paribas (OTC:BNPQY) has cut a dozen jobs in mainland China and Hong Kong, as reported by a source familiar with the matter. This decision marks the latest move by global banks to reduce headcount amid a slowdown in dealmaking within the Chinese market.

The bank has begun notifying the affected employees, predominantly in investment banking and corporate finance roles. The source, who requested anonymity, indicated that previously, BNP had around 100 employees focused on China-related deals in its Hong Kong and China offices.

A spokesperson for BNP declined to provide any comments regarding the cuts. Bloomberg initially reported on the job reductions at the French bank.

In recent years, global investment banks have been scaling back their workforce in China due to a slowing economy and increased regulatory scrutiny, which has negatively impacted the revenue potential of corporate dealmaking and fundraising.

While there were high expectations for stronger stimulus policies from China to enhance share sales, the actual measures implemented have fallen short of expectations.

In the first three quarters of 2024, banks raised $41.5 billion from China’s equity capital markets, reflecting a 62.5% decline from the same period last year, marking the lowest total for the first three quarters since 2008, according to data from LSEG.

During the same timeframe, BNP participated in only one Hong Kong equities deal as a bookrunner, raising $6.5 million, and ranked 31st out of 32 bookrunners.

An estimated $9.1 billion in investment banking fees were generated across China during the first three quarters of 2024, representing a 25% decline compared to last year, according to LSEG data.