The Confederation of British Industry said in January that the country’s financial industry will lose 43,000 jobs in the six months to March. About 72 percent of the 2,872 employees who left London jobs at nine large banks that required the so-called approved-person registration with the U.K. Financial Services Authority between January 2012 and February 2013 haven’t found new roles to rejoin the register, according to a report posted on eFinancialCareers, a recruitment website.
Some Asian hedge-fund professionals have gone further afield. Sanjiv Bhatia in December joined Harvard Management Co., which oversees the endowment of the university in Cambridge, Massachusetts, after closing down his Isometric Investment Advisors Ltd. in Hong Kong. He’d set up the now- defunct hedge fund in 2009 after running Asian investments for Deephaven Capital Management LLC, a hedge fund in St. Francis, Wisconsin.
Christophe Lee, who worked at FrontPoint Partners after heading SHK Fund Management Ltd., confirmed that he became chief financial officer of Hong Kong-headquartered device maker OrbusNeich Medical Inc. in March 2012. He declined to comment further.
Daren Riley -- who last year shut down Riley Paterson Investment Management Pte, a Singapore-based hedge fund he co- founded in 2007 -- now advises consultancy New Crossroads Asia, which helps facilitate investment in Southeast Asia, according to its website. Bhatia and Riley didn’t respond to e-mails seeking comment.
With banks now adapting to a fresh host of regulatory rules, from new capital requirements to tightened scrutiny over derivatives, the Asian hedge-fund industry’s fortunes seem unlikely to turn soon. Hedge funds in Asia used to rely heavily on wealthy investors making investments through funds of funds, financed partly through bank borrowing, the CFA Institute’s Smith said. That lending has dried up.
“Banks will remain reluctant providers of leveraged finance for the foreseeable future,” said Smith, who came to Hong Kong in 1996 as Asia head of Bank of Bermuda’s fund services business. He rose within HSBC Holdings Plc’s fund services after it acquired the former and stayed until 2006, after which he went to head Hong Kong-based Triple A Partners Ltd. Smith took up his role at CFA Institute in October.
“Given the quantity and scope of the new regulation that already faces banks, plus the additional uncertainty over any new regulation that may be being planned,” Smith said, “it’s difficult to see how banks will be able to stabilize their business models in the near future.”
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