59-year-old financier reflects on the 'astonishing' pace of change in Hong Kong's investment industry Thirty years ago, Ralph Parks paid less than US$500 a month to live in a three-bedroom flat on Po Shan Road in Mid-Levels. He played tennis during lunch breaks at the Cricket Club on Chater Road in Central and Jardine House was the tallest building in Hong Kong. At the time, Mr Parks worked for Merrill Lynch, then an up-and-coming New York brokerage house that had yet to make its mark on the city's investment banking industry. Swire and Jardine were the British-backed powerhouses running colonial Hong Kong. These days, Mr Parks lives in a spacious, two-storey, JP Morgan-owned apartment on the Peak. The Cricket Club has moved out of town and Jardine House stands in the shadow of about half a dozen taller skyscrapers across the street from Chater House, the new headquarters of JP Morgan Asia, where Mr Parks has served as chairman for the past two years. 'It was just so different then,' said the 59-year-old Mr Parks during a recent interview. 'When I arrived in Hong Kong in June 1973, the Hang Seng Index had just come crashing down a few months before and had lost about 80 per cent of its value. The town was run by the likes of Swire, Jardine and Wheelock Marden. No international investment banking firms were present in Hong Kong providing investment banking services as we know today. 'Looking back on those 30 years, it's been very concentrated in terms of development. There were vast areas of the New Territories that were just paddy fields. The Cross Harbour Tunnel was brand new.' During his two years in Asia, Mr Parks explored the region both as a tourist and professionally, including a 1974 Bank of China-sponsored trip to a China that was largely closed to the outside world. 'All that has given us a real basis for appreciation of all the changes in the region. I feel privileged I got to join that trip into China so I can appreciate what China was. To see 30 years later what it's become is just astonishing,' he said. 'Now when I travel around Shanghai or Beijing, I compare it with my memories of rush hour in Guangzhou [back then]. In those days, the overwhelming sound was the whirring of bicycle wheels and the tinkling of bicycle bells. There were literally thousands of bicycles. There were no other sounds at all. 'Now I look at Shanghai today, sitting in a hotel 85 storeys above Shanghai; it's stunning.' Mr Parks left Hong Kong in 1975, as China's Cultural Revolution was ending. He returned in 2001 to a vastly changed city, controlled by Beijing rather than Britain. In the interim, Mr Parks, who looks like the quintessential New York banker in a blue pin-striped suit, spent his career at two of the most powerful houses on Wall Street. After a decade at Merrill Lynch, he joined Goldman Sachs where he spent 14 years. Based in London, Mr Parks was in charge of the bank's investment banking operations in Europe before retiring as a limited partner in 1994. After a two-year stint running a primary school for children with learning disabilities that he founded in Connecticut, Mr Parks returned to investment banking as a partner of the Beacon Group, which was acquired by Chase Manhattan Bank before its merger with JP Morgan in late 2000. After the merger, Mr Parks became chief operating officer for investment banking in Europe, based in London, before taking on his current Hong Kong post. Mr Parks came to Hong Kong as JP Morgan was wrestling with a three-way merger with Chase Manhattan Bank and home-grown Jardine Fleming. Mr Parks said overseeing the transition had been a critical point of his career in Asia. He hoped his legacy would be the successful integration of the three banking operations and cultures. It was a challenge 'to get the diverse capabilities we have and diverse cultures from three firms well merged together and well aligned', Mr Parks said. Mr Parks now oversees a staff of 6,500 in 24 offices in 15 countries in Asia, providing a range of financial services. The staff dwarfs most of its rivals but Mr Parks defended the investment in staff numbers. 'We made a conscious decision to remain present in 15 countries around the region,' he said. 'We like the ability to have deep, long-standing local relationships and deep local knowledge and to employ that local knowledge for our global clients, whether they're investor clients or corporate clients. 'Also on the strength of our local relationships, we can more frequently and effectively access those clients in thinking about their needs, their ambitions and concerns and address them locally as opposed to flying in short-term solutions or faxing in solutions. And in my experience, that gives us a distinct competitive advantage.' However, Mr Parks did admit that having a staff of 6,500 could strain resources. 'Having said that, when you have a broad platform, you have to be very, very mindful of cost pressures and the economics that the markets provide and closely watch and monitor to make sure that you balance your local presence to the opportunities and scale over a long period of time, not a few quarters but over a multi-year period. 'In the far distant future when people look back at the time that I was here, I hope they say I had a hand in aligning and focusing the firms we merged and as a result, this is now - quickly became and remained - a very focused, coherent, thriving and successful firm.' Not that Mr Parks is leaving Asia anytime soon. Indeed, he was quick to quash any rumours of an imminent departure. 'I'm here for the duration as far as I'm concerned. I'm having way too good a time to think about anything else,' he said. 'I have a fun job; I don't have a tough job. It's fun because I get to compete against able competitors; I get to work with smart, energised, motivated people. I get to serve a dynamic, diverse and demanding client base. I think that's a tremendous recipe for job satisfaction.' And Mr Parks is also very busy - in the past month he took 12 flights around Asia and to the US, even as travel restrictions due to Sars have slowed business down. Even his colleagues marvel at his stamina. 'He has a ranch in the Grand Tetons, a big place in Connecticut, and the big bonus from being a Goldman partner, so why does a 59-year-old guy keep working 80 hours a week?' a JP Morgan colleague asked. For now, JP Morgan, like most investment banks active in the region, is setting its sights on China, where JP Morgan hasn't been notably successful winning high-profile mandates to take China's massive state-owned enterprises to international equity capital markets. 'We are very ambitious for the long term in China. As far as China is concerned, it must be said we were not effectively competing for equity mandates in the mid-90s. The capability this firm has today didn't exist two years ago,' Mr Parks said. 'There were some equity transactions which we won but they were not consistently the largest or the most spectacular headline-winning transactions. Since we have fully integrated and invested in our platform, we will be more effective in competing for those mandates in years ahead. 'Let's face it, those are headline-grabbing but many take years of execution and arguably are very, very challenging for the firms involved on a total return analysis.' JP Morgan has been actively building its China business. The firm recently poached one of Merrill Lynch's top China bankers, Charles Lee, and Mr Parks said it planned to add more to its 60-person China team. Last year, JP Morgan served as an adviser to Huaneng Power on two M&A deals, valued at US$547 million, and as adviser to the parent company of China Unicom on its US$2.7 billion acquisition of nine mobile networks from the parent. As a step towards realising its China ambitions, JP Morgan recently established a 150-million-yuan fund management joint venture in China with Shanghai International Trust and Investment Corp, the financial arm of the Shanghai government. 'Our hope is to have the fund up and running by the end of the year. We hope the fund is as big as possible. With more than US$1 trillion in personal savings and with only 2 per cent in funds as opposed to bank accounts, the potential market is huge,' Mr Parks said, adding that JP Morgan also would pursue other opportunities in China. 'We have bankers in China who are actively working on a number of important transactions, which are very remunerative either currently or prospectively, with both state-owned enterprises and private enterprises as well as multinationals. With this momentum, the addition of our renminbi and forex licences and the newly announced JV - we're well on our way in China.' Biography Ralph Parks is chairman of JP Morgan Asia Pacific, a position held since April 2001. He started his career in 1970 at Merrill Lynch, where he spent a decade, including two years in Hong Kong. In 1980, he joined Goldman Sachs where he worked for 14 years. After founding The Pear Tree Point School, a primary school for children with learning disabilities in Connecticut, Mr Parks returned to investment banking with the Beacon Group. The Beacon Group was acquired by Chase Manhattan Bank in July 2000 before its merger with JP Morgan later that year. After the merger, Mr Parks served as the London-based chief operating officer for investment banking in Europe before taking on his current post in Hong Kong. He is married with three children.