Investment bank to keep Asia-Pacific headcount at 10,000 The subprime crisis has forced a number of multinational financial institutions, including Citigroup, to announce global lay-offs, but UBS, the world's largest wealth manager and also a credit crunch victim, has vowed not to scale down its expansion plans in Asia-Pacific. Rory Tapner, UBS Asia-Pacific chief executive, said in an interview that his group would not cut its regional headcount of about 10,000 - at least not in the near term - despite uncertainties surrounding stock markets and a slowdown in the capital market. 'We've spent four years building up our business in Asia-Pacific, which remains a special area of focus for our group,' Mr Tapner said. 'If we make some knee-jerk reaction and lay off a large number of people in response to a short-term downturn and then find the market recovering, it will be difficult, and expensive, to rehire the talents we need.' So it is only if the negative conditions prevailed for a period of 12 to 18 months that UBS would conduct a detailed review of resources and costs, he said. After the Swiss bank announced on January 15 a write-down of US$18 billion in subprime-related losses for last year, its share price has dropped to a 10-year low. Having identified the region as a high growth area four years ago, UBS was not about to change its course, Mr Tapner said. In fact, the mainland, Hong Kong, Japan, Australia, India, Singapore and South Korea are performing well. In Hong Kong, UBS is well known for investment banking, being a leading sponsor for many initial public offerings. It is also the only international bank to have control of a mainland brokerage to manage A-share offerings in that market. For UBS, the recent slowdown in listing activities certainly hurts business. Earlier this month, the investment bank had to call off two of the offerings - namely Wing Fat Printing and China Pacific Insurance - for which it acted as arranger. Wing Fat, a packaging paper manufacturer in the Shanghai Industrial Holdings group, was seeking US$89 million while China Pacific, the third-largest insurer on the mainland, was hoping to raise US$3 billion. While admitting that flotation of new shares has been reduced, Mr Tapner said other activities, such as foreign exchange and commodities trading, were making up for the loss. 'We are very active in the IPO market but IPOs are by no means our only business,' he said. 'Even in a normal year, IPO revenue is not that substantial when compared to our overall business in the region.' Mr Tapner said UBS offered 'a well-diversified range of businesses' in equities and cash trading, fixed-income trading, foreign exchange, merges and acquisitions advisory services as well as wealth and asset management. 'UBS activities in the region in the first quarter are at about the same level as the same period last year.' He said many companies still wanted to go public so the line-up of future listings looked encouraging 'once the markets recover'. UBS also sees new opportunities in India, thanks to its recently obtained licences for onshore wealth management and fixed-income business, on top of stock broking and investment banking. However, UBS sees uncertainties in another growth market, the mainland, where investor concern over the government's campaign against high inflation has brought about a stock market slump. Mr Tapner said some primary market activities, such as the offloading of shares by major shareholders, would continue since they would not increase inflation pressure. Like many other investment banks, UBS will bid for mandates to advise and invest for the China Investment Corp, the mainland's sovereign wealth fund that is managing US$200 billion. Mr Tapner in fact believes the mainland's contribution 'may match that of Japan some time in future, but not ... next year'.