Matthew Kirkby has left Malaysia's CIMB to join HSBC as head of its large corporate business for commercial banking in the Asia Pacific region, the British bank said on Thursday.
Kirkby was one of the most senior Royal Bank of Scotland bankers brought on board by CIMB as part of its acquisition of RBS’s cash equities, equity capital markets and corporate finance businesses in Asia-Pacific.
The deal, which Kirkby negotiated for RBS along with Peter Irvine, was meant to boost CIMB into one of the largest regionally based investment banking franchises in Asia Pacific and enable RBS to exit these businesses at a limited cost.
Kirkby, who was Asia-Pacific head of global banking and global head of corporate finance at RBS, became co-head of investment banking for Asia-Pacific at CIMB together with CIMB’s current head of investment banking, Sooi Lin Kong. Double-hatting often happens during financial mergers. He also took on an additional role as CEO for North Asia, leading the 192-strong team in Hong Kong at the time, providing investment banking advisory services, equity and capital market fund raising abilities, broking services and research.
Overtime his responsibilities grew, said one person familiar with his role. He has been on gardening leave for over a month already.
Since then CIMB has scaled back its overseas business and is cutting costs. CIMB said earlier this year it is looking to reduce its Asia-Pacific investment banking and equities operating costs by 30% in 2015.
As part of this clampdown, CIMB closed its offices in Sydney and Melbourne. The Kuala Lumpur-headquartered bank also made 40 people redundant in February, mostly in equities trading across Hong Kong, Taiwan, India, and South Korea.
“We have taken a long hard look at our Asia-Pacific investment banking business. The realities of today’s capital markets and the absence of sufficient flows have directly contributed to this decision,” CIMB’s acting CEO, Zafrul Abdul Aziz, said in a statement in February as part of a strategic review.
Loan growth is spluttering in Malaysia, partly due to the sharp fall in the price of crude oil, a key Malaysian export. Malaysian banks are also facing a massive liquidity squeeze resulting in net interest margin compression. CIMB’s share price fell as a result and put an end to its three-way merger with RHB Bank and Malaysia Building Society (MBSB).
In his new role with HSBC based in Hong Kong, Kirkby will report to Noel Quinn, regional head of commercial banking Asia Pacific and Joel Van Dusen, global head of large corporates for commercial banking.
“He will be responsible for driving our large corporate business in partnership with HSBC's market leading product partners and business lines,” said Quinn in the statement.
Kirkby replaces David Morton who transferred to Gordon French’s global banking and markets division last August to become the regional head of credit and lending. The position has been vacant since August as HSBC searched for the right candidate to replace Morton.
During Morton’s tenure HSBC commercial banking in Asia significantly boosted collaboration with other parts of the bank; firstly for foreign exchange products and then increasingly for DCM deals, particularly of late high yield bonds.
Last year HSBC completed 157 capital financing transactions for its commercial banking clients, up from 122 deals in 2013.
Collaboration is now focused more on other product areas such as ECM deals and M&A. One area that HSBC has scored some notable wins recently has been convertible bonds as it has been able to offer commercial banking clients more favourable terms than competitors by offering asset swaps because it knows the credit well.
With his background in investment banking, Kirkby will focus on offering HSBC’s largest corporate clients around the region corporate finance solutions such as M&A financing. Kirkby will be teaming up with an old ABN Amro colleague at HSBC, Jason Rynbeck, who was brought in to bolster the British bank's M&A services. The appointment goes into effect July 6.
In the first quarter HSBC’s commercial banking revenue rose by $0.2billion driven by credit and lending and payments and cash management, primarily due to higher net interest income, mainly in Hong Kong and the UK. In Hong Kong, this reflected average balance sheet growth together with wider lending and deposit spreads.
Tony Lee is currently the head of large corporates for our commercial banking business in Hong Kong, and he will be reporting to Kirkby as well as the head of commercial banking in Hong Kong.
Kirkby graduated from Oxford with a law degree and started his career as a solicitor in London and Hong Kong. He joined CLSA as an ECM banker in 1996 and then ABN AMRO as head of South Asia ECM in 2000.
He later became head of M&A and ECM for Asia-Pacific at ABN AMRO (which was subsequently taken over by RBS). He was also global head of equities origination and corporate finance for RBS in London.
