Date
24 September 2017
Deutsche Bank is reported to be planning to re-enter  the warrants and callable bull-bear contracts market in Hong Kong. Photo: Bloomberg
Deutsche Bank is reported to be planning to re-enter the warrants and callable bull-bear contracts market in Hong Kong. Photo: Bloomberg

Deutsche Bank said to be returning to HK warrants market

Deutsche Bank AG may be returning to the warrants and callable bull-bear contracts market in Hong Kong, according to the Hong Kong Economic Journal.

The German bank is now looking for some personnel for the business, giving a mandate to some headhunters to seek out qualified talent, the report said Monday, citing market sources.

Deutsche Bank left the market three years ago gradually after a senior executive was accused of corruption and fraud, causing its market share slide to just 1 percent.

The senior executive was found guilty and given a seven-year prison term.

A Deutsche Bank spokesperson didn’t confirm the rumored plan for a return to the business, the paper said. 

Hong Kong’s securities watchdog had enhanced its grip over the warrant market since 2012, adding to issuance costs. 

Intense competition in the market also led some issuers to exit the market. Four out of the 17 licensed warrant issuers in the city have halted such business, data at Hong Kong Exchanges and Clearing Ltd. showed. 

The issuers include The Royal Bank of Scotland, Rabobank Group, Bank of America Merrill Lynch and Citigroup. The city had about 30 issuers in the market at the peak.

Observers said Deutsche Bank’s possible return to the business may be due to an increase in market volatility, which is expected to rise further in the next quarter as the US Federal Reserve is likely to raise its key interest rate and after China’s recent move to cut its benchmark rates.

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VW/JP/RC

Freelance journalist

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