1/ Challenges and opportunities to DBS and customers with the establishment of DBS Securities in China
DBS Securities, our fully licensed onshore securities joint venture based in Shanghai, officially began operations in June this year (2021). As the capital markets in China continue to open up, with an increasing number of companies to be listed there and global institutional investor’s investing interest continue to grow, we want to be a big part of it. This milestone allows for us to leverage on a fully integrated onshore and offshore investment banking platform covering ECM, DCM, Securities Brokerage, Research and Trading, further enhancing the One-bank / One-team solutions-driven approach we strive to provide to our clients.
Adding on to what we have been able to achieve for our clients in China from a capital market prospective, particularly as we help them list and raise debt and equity capital offshore, we now have a large and dedicated team to help them with more solutions onshore. With many international banks also quickly moving into the China onshore market, and with so many strong local players already present in China, DBS has to be smart and play to our strengths. We are a strong regional bank, with wide international reach, innovative solutions and have a long track record of delivering for our clients. As an example, we will leverage our leading REITs franchise in Asia to help issuers in China to explore a C-REIT listing onshore or look to expand offshore with REIT listings in Hong Kong or Singapore.
In addition, we can help our investor clients, institutions, private banks, corporates, etc. to invest in China and outside. So far in our short history, we have already participated in our first IPO in August (2021) and was a JGC in our first bond issuance onshore in October (2021). We have also successfully obtained our license for the Beijing Stock Exchange, which was just opened earlier this month. Though we have made great strides in the months we have opened our doors, much is still to be done and the challenge is very exciting.
2/ The trend in the Asian stock markets in 2022
Overall, 2021 was a very strong year for equity markets globally, all-time highs were reached in the US, and other parts of the world. In Hong Kong, the equity issuance market was a very strong one. Already surpassing the USD 100 billion mark, a record high. However, the pace of issuance has slowed down somewhat in the second half of this year (2021). But looking ahead in 2022 and beyond, we remain very bullish of the region, particularly around Hong Kong and China. But we continue to see capital flows coming into this region, and high quality issuers ready to come to market.