Korea’s Mirae Asset Securities is halving the number of staff in its Hong Kong office, cutting back its team of analysts in response to poor equity trading volume.
The move will see its 38-strong office shrink to about 20. Its Hong Kong team consists of nine analysts and five/six sales staff, of which all are being made redundant with the possible exception of one or two analysts. At the same time its back office is being downsized.
An announcement was made to the staff in Hong Kong yesterday morning by CEO Ashley Dale. Some will leave “soon”, while the others will leave in a month of two “in accordance with their employment contracts”, says a company spokesman.
In a statement to AsianInvestor out of Seoul, Mirae noted that the total volume of equities trading in Hong Kong was $1.2 trillion for 2012, 21% down from the previous year, forcing it to downsize its operations "as a natural course".
“Considering the market conditions, we need to reduce this department [Hong Kong],” Kim Sang Joon, CFO of Mirae Asset Securities Hong Kong Limited, tells AsianInvestor. “We felt that we had to move because it is hard to see the market picking up again quickly.
“But in Korea we have a strong research centre and analyst presence and we can continue to provide a research service to our Hong Kong clients from Korea.”
However, Kim was at pains to deny that Mirae Asset is closing its Hong Kong office, as reported by the South China Morning Post yesterday. “We will maintain our trading rights and our Hong Kong licence in Hong Kong. This [SCMP] report is wrong. Our Hong Kong office is important and supports our subsidiaries in the US, Vietnam and Brazil. We have no plans to shut the office down.”
A spokesman in Seoul adds that Mirae Asset Global Investments, its asset management division, would not be affected and, in fact, is "under review for early expansion". He also notes that Mirae Asset is considering enhancing its wealth management division.
Dale will remain to run the office in Hong Kong alongside Kim. Mirae will maintain its other functions in the city, including Korea sales, settlement, dealers, accounting, human resources, principal investment and compliance, notes Kim.
Asked if further cuts were likely, either in Hong Kong or its offices globally, Kim replies: “We do not have any plans for the other parts currently.”
Out of Hong Kong Mirae Asset Securities was chiefly covering equity trading across Hong Kong, Japan, Taiwan and Singapore.
Mirae is following in the footsteps of Samsung Securities, which moved to cut back its international operations in Hong Kong and focus on its home market, as reported. But Samsung’s operation was bigger, with estimates of 150 staff in the city prior to the cutbacks.