Francis Leung has confirmed market rumours that he is to resign from his position of chairman of BNP Paribas Peregrine, effective June 30. It has also been confirmed that he will head up investment banking operations at Salomon Smith Barney (SSB).
Leung is one of the best known equity bankers in the Hong Kong market. He was one of the founders of Peregrine back in 1988 and was instrumental in much of that firm's initial success. He was recently cleared in the government report into the ill-fated investment bank's demise - one of the only directors to be exonerated.
Since BNP bought the rump equity business of Peregrine in 1997, Leung has maintained his colossal hold over the Hong Kong equity market. Most recently he has been the king of the GEM market - the secondary board of the Stock Exchange of Hong Kong, established in 1999. His impeccable contacts among both issuers and investors have allowed him and BNP Paribas Peregrine to win more mandates than anyone else on the basis of local distribution power. His dominance of the GEM market has not abated with the market downturn. In the first quarter of this year, the firm has done over 50% of all GEM IPOs and which now represent 60% of its market capitalization. It is unclear if BNP Paribas Peregrine and their newly promoted chairman Alex Ko will be able to maintain such a dominance in Leung's absence.
SSB's Asian investment banking head Sanjiv Misra confirmed to FinanceAsia a couple of weeks ago that he was looking to hire someone big in China to help it out of its stasis. SSB has been desperate to get a China equity rainmaker to help it win the jumbo mandates on the mainland. Since pulling the CNOOC equity offering in early 2000, the firm has been somewhat out of favour on the mainland, with very few mandates to its name.