UBS’s Hanning Replaces Grounds as Asia Investment-Bank Head

Posted by Anton Murray Consulting on 16 Jun, 2014

Narayanan Somasundaram and Cathy Chan

UBS AG (UBSN) named Matthew Hanning as the head of its Asia-Pacific investment-banking unit, replacing Matthew Grounds, who will focus on the Swiss bank’s Australian operation.

Hanning, 46, will become head of corporate-client solutions for the region and also join UBS’s investment-banking executive committee, according to a memo to employees yesterday that was confirmed by Rob Stewart, a Hong Kong-based spokesman.

Hanning will take over a business from Grounds that was the top-ranked manager of equity sales in the Asia-Pacific region in 2013 for the first time in five years and almost doubled the number of high-yield bond offerings it arranged, data compiled by Bloomberg show. UBS is ranked fourth in equity sales and third in high-yield bond offerings this year, the data show.

“The appointment underlines our commitment to provide opportunities for our next leaders to drive the business further,” Andrea Orcel, the Zurich-based firm’s chief executive officer for investment banking, and Asia-Pacific CEO Chi-Won Yoon said in the memo.

Grounds, 45, will remain CEO and country head of UBS Australasia and report to Yoon, according to the memo. The personnel moves were reported by the Australian Financial Review earlier yesterday.

Client Solutions

UBS said in November 2012 it was splitting the investment bank into two groups. Corporate-client solutions includes mergers advisory, capital marketsand financing for companies, financial institutions and private-equity firms. Investor client services encompasses equities, foreign exchange, precious metals, rates and credit.

The Asia-Pacific corporate client-solutions business is key to growth in a part of the world where linking investment banking with Asia’s increasing number of wealthy clients is critical to profitability, Christopher Wheeler, a London-based analyst with Mediobanca SpA, said last year.

Under Grounds’ leadership, that unit came to represent 35 percent of investment-banking revenueworldwide in the first half of 2013, compared with 23 percent before the 2008 financial crisis, when UBS was building up fixed-income trading.

UBS has been able to take advantage of relationships between wealth management and the investment bank, Hanning said in a phone interview last year, when he reported to Grounds as co-head of Asia-Pacific investment banking. UBS said last July that it has a relationship with as many as 80 percent of Asia’s billionaires.

Deals Experience

Hanning, a lawyer by training, joined UBS from Morgan Stanley in 2006 as head of mergers and acquisitions for the Asia-Pacific region. He has been based in Hong Kong since 2004, and advised on more than 50 initial public offerings, financings and mergers, according to a profile provided by the Swiss bank.

The appointment comes at a time when UBS CEO Sergio Ermotti is trying to bolster earnings by focusing on money management, which requires less capital than investment banking, and divesting assets that are producing losses and eating up resources. First-quarter net income rose 6.7 percent from a year earlier to 1.05 billion Swiss francs ($1.2 billion), the firm reported on May 6, beating analyst estimates.

The future of UBS could look like the Australian and Asian businesses, Grounds said in an interview in July, calling them capital-light, dominant in equities and with a strong position in research and investment banking.

“I’m not saying UBS is going to be No. 1 globally,” he said at the time. “But there’s no reason why Europe can’t have this model.”

In Australia and New Zealand, the bank named Anthony Sweetman, the current head of corporate advisory, as head of the corporate-client solutions group, according to a memo to employees that was confirmed by Sydney-based spokeswoman Caroline Gurney. Sweetman replaces Guy Fowler, who becomes chairman of the unit.

Greg Peirce and Kelvin Barry will become joint heads of coverage and advisory for Australia and New Zealand, the memo said.

Bloomberg

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