After 19 years in investment banking, 45-year old Cezar 'Bong' Consing is stepping down from his role as co-head of investment banking at JPMorgan to pursue personal interests - with some speculation now focusing on whether he is going to be the next Finance Secretary in the Philippines. Consing will, however, currently retain a role as a senior advisor to JPMorgan, and his position as co-head will be filled by Todd Marin, the current head of the highly successful M&A division. Marin will share the co-head position with existing co-head, Sean Wallace. Here we speak to Wallace and Marin about the changes in the firm's leadership and get their outlook for the year ahead.

What's the genesis of the recent changes?

Wallace: Bong has been doing some soul-searching about the business for quite a while. By all accounts, he has done an excellent job since the day of the merger on January 1, 2001. His hard work paid off last year as we had a very strong performance in all of our products, sectors and countries. Now that the business is in great shape, he is evaluating what he wants to do next. As a professional he could do a variety of things such as working for the government of the Philippines, running a bank in Asia or leading a private equity fund - he is a very talented person. His depth of talent is driving him to assess a new chapter in his life after being a successful banker for 19 years.

So we can expect Bong to turn up as the Philippines finance minister?

Wallace: I would prefer you ask Bong that question. Undeniably his clients and colleagues know that he could be on a short list for a variety of impressive jobs.

How will the responsibilities be shared now?

Marin: One thing that Sean and Bong did as co-heads was to bring me in as a partner with them on most of the decisions across investment banking. So Sean and I have been working as partners for a long time and have developed a strong relationship. I will retain the M&A platform, so by virtue of that I will be spending a disproportionate amount of my time on the M&A business.

Wallace: There will be some changes but I truly believe that like my partnership with Bong, Todd and I will make a "hand in glove" team. Without question, Todd is the best M&A guy in Asia, and my strength as a financing person fits well with his capabilities.

By the end of last year there was some confusion as to whether Sean was based in Australia. Where are you based?

Wallace: While I have spent a great deal of time in Australia, I love Asia and am particularly thrilled to live in Hong Kong. Since July, we have systematically upgraded our team 'down under' with the express design of growing and improving our business. We now have more senior bankers in Australia than we have ever had in our history. The upgrading strategy has included moving over 10 senior JP Morgan Australian professionals from around the world back to Australia. We have also hired one of the biggest talents in the market place, Mike Tilley, who used to be chairman of Merrill Lynch for Australia. We are excited about the opportunities in Australia and view this country as a growth market.

What's your outlook for the M&A business this year?

Marin: In my view, last year was one of stabilization. Our business was up nicely in the region in terms of fees and number of transactions, and this year there is additional upside potential. With the North American economy having come back, we have seen an increase in cross-border dealflow. It started to pick up last October and has continued to accelerate. I don't think we'll see double digit growth, but the market will be up nicely, and the tenor will change to more cross-border activity.

It has been a reasonably good start to the year. Do you think this will be a year that will be remembered predominantly as an ECM year?

Wallace: The appetite for risk on the part of equity and debt investors continues to grow. We are seeing this increase in risk appetite substantially raise the demand for higher risk debt and equity securities and for exposure to high growth regions such as Southeast Asia. It will drive capital raising across the board, in particular equity raising, therefore making 2004 the year of the equity market.

Do you think this could be a record year for Asian ECM?

Wallace: It kind of feels that way. China, India, Thailand, Indonesia and others will all be looking to raise large amounts of capital. Come bonus time, I believe it will be great to have been an ECM banker in 2004.

Is the US recovery for real, or could that pose a problem?

Marin: It's an election year and so buttons are being pushed to make sure the economy does well. Importantly, CEO confidence is returning, capex spending is up, and there are early signs of hiring. So while there may be quarterly ups and downs, the attitude is much more positive, which is good for the economies across Asia as well as the investment banking business.

Wallace: The last quarter was one of the most profitable in US history. This profitability will drive increased capital expenditures, M&A and other forms of growth which should drive growth on a global basis.

So you are both bullish?

Wallace: Anecdotally, I can tell you that our confidence is high for a number of reasons. Firstly, our backlog is the strongest we've ever seen it. Secondly, we are seeing significant activity in terms of new deals, hours worked, new deals filed etc. We are very busy! This anecdotal evidence combined with our economists' views indicates that 2004 will be strong.