BNP Paribas trims China workforce amid fee plunge

French banking giant BNP Paribas joined the growing list of global banks reducing their headcount in China. The bank has cut around a dozen jobs across its mainland China and Hong Kong offices, according to a source familiar with the matter.

The job cuts, primarily affecting investment banking and corporate finance roles, began last week. This decrease comes as BNP Paribas had approximately 100 employees focused on China-related deals before the announcement. The company spokesperson declined to comment on the specific numbers.

This move reflects the broader trend of global investment banks scaling back their China operations. A slowing Chinese economy coupled with stricter regulations on dealmaking and fundraising has dampened the market’s profitability.

Initial public offerings (IPOs) initially saw a boost due to hopes of strong government stimulus policies. However, these measures have fallen short of expectations.

Data from LSEG reveals that banks raised only $41.5 billion from China equity capital markets deals in the first three quarters of 2024. This represents a significant 62.5 per cent decline compared to the same period in 2023 and the lowest first-three-quarter total since 2008.

LSEG data shows the bank served as a bookrunner on just one Hong Kong equities deal in the first nine months of 2024, raising a mere $6.5 million. This placed them 31st out of 32 bookrunners in the period.

Furthermore, industry-wide investment banking fees in China experienced a 25 per cent decline during the first three quarters of 2024, reaching an estimated $9.1 billion. This trend highlights the subdued state of the Chinese dealmaking landscape, contributing to BNP Paribas’ workforce reduction.

Attribution: Reuters

Subediting: M. S. Salama