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Deutsche Bank moves global head of equity trading to HK

PUBLISHED : Wednesday, 05 March, 2008, 12:00am
UPDATED : Wednesday, 05 March, 2008, 12:00am

Deutsche Bank, the largest investment bank in Germany, is moving its global head of equity trading, Noreddine Sebti, to Hong Kong from New York as business in the region is expected to grow despite a potential economic recession in the United States.

'Locating a global business head in Asia clearly demonstrates the changing polarity of global equity markets and the growing importance of the region for clients and our business globally,' said Yassine Bouhara, the global head of equities at Deutsche Bank.

Mr Sebti will also replace Colin Fan, who headed Asia equity trading. Mr Fan is moving to London to co-head the bank's global credit trading business.

The bank did not say whether it would increase trading staff in Hong Kong.

Hedge funds, pension funds and private equity funds have been increasingly looking to the high economic growth of Asia to increase their investment returns.

Still, the move to Hong Kong of such a senior banker raised eyebrows among some market observers.

'There might be genuine business reasons but is it going to change Deutsche's long-term earnings capacity? Possibly but then possibly not,' said David Williams, an analyst at Fox-Pitt Kelton.

London-based Helvea analyst Peter Thorne said the sheer volume of trading that went on in New York and London relative to elsewhere made a move to Hong Kong unusual.

'Hong Kong truly is an important place but it seems bizarre,' he said.

Deutsche Bank revenue from its global equity business revenues hit Euro4.6 billion (HK$54.4 billion) last year.

That accounted for 35 per cent of total sales and trading revenues, which included debt trading, of Euro13 billion.

Net income fell 48 per cent in the fourth quarter to Euro953 million. A regional breakdown of revenue has not been disclosed by the bank.

Deutsche Bank and Goldman Sachs are two of the very few investment banks to so far weather the subprime mortgage crisis in the United States better than their peers.

European rivals such as UBS, the largest bank in Europe by assets, lost 12.5 billion Swiss francs in the fourth quarter of last year compared with a profit of 3.4 billion francs in the same period in 2006.

Credit Suisse, the second-largest bank in Switzerland, saw net income plunge 72 per cent to 1.33 billion francs in the period.

About US$163 billion has been either written down or reserved as a loss by banks and securities brokerages since January last year.

Mr Sebti is Swiss and joined Deutsche Bank in 1998.

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