Citigroup (NYSE: C) is looking into setting up an onshore cash equities business in China and expanding research coverage of Chinese stocks while the company tries to boost their share in Asia. The company is also looking to add at least 10 people to the unit which will include bankers and technology staff mainly at the Hong Kong and Singapore locations.
Citigroup has been targeting their focus on their Asia equities business that includes stock trading and research as they try to boost their trading technology, financing to hedge funds, as well as hire senior bankers.
China’s listed shares’ inclusion in the U.S. index publisher MSCI’s emerging markets benchmark this year which is a huge advancement for global investing. This would lead to a rise in demand for research services and brokerage. Furthermore, an introduction of programs allowing two way trading between stock markers in cities like Hong Kong, Shanghai, and Shenzhen has made Beijing open up their capital markets. The country’s brokerage revenue pool reached $41 billion two years back. 1% market share would bring that amount to $60 million in annual reveue to an equities house in the world’s second largest economy, that being China.
Citigroup will provide research on 175 China listed firms and will expect increased coverage to 200 by year end and 250 in the longer term.