China's Banker Exodus Threatens Coronavirus Recovery - OZY | A Modern Media Company

China's Banker Exodus Threatens Coronavirus Recovery

China's Banker Exodus Threatens Coronavirus Recovery

By Primrose Riordan and Don Weinland

Passengers with protective masks wait for their flight to Shanghai at Suvarnabhumi airport in Bangkok, on February 24, 2020. - The novel coronavirus has spread to more than 25 countries since it emerged in December and is causing mounting alarm due to new outbreaks in Europe, the Middle East and Asia. (Photo by Hector RETAMAL / AFP) (Photo by HECTOR RETAMAL/AFP via Getty Images)


With the drivers of China's financial sector leaving, an economic recovery will be ever harder.

By Primrose Riordan and Don Weinland

When Beijing-based banker Peter Ling-Vannerus landed in Hong Kong last month, he was given a stark choice: Spend 14 days in quarantine or hop straight back on a flight and leave the city.

He opted to spend time in Thailand rather than be confined in Hong Kong. Ling-Vannerus’ experience is typical of the thousands of international bankers, investors and lawyers who live in what is normally one of the world’s busiest regions for deal-making and business travel.

Since the deadly coronavirus that causes COVID-19 erupted in January, scores of bankers and their families have fled mainland China and Hong Kong to work in offices elsewhere in Asia. In the process, their often luxurious expatriate lives have been disrupted, with international schools shut and domestic helpers unable to follow them to third countries.

It’s been very, very quiet here over the past few days.

Peter Ling-Vannerus, banker

Those who have remained within China have been subject to strict rules severely limiting movement between cities and sometimes within neighborhoods. A lockdown on travel across the region has brought business in greater China to a near standstill.

“It’s been very, very quiet here over the past few days,” says Ling-Vannerus, who eventually returned to Hong Kong, where he is staying with his family. He has set up a home office but does not know when he will be able to return to Beijing.

Even within China, business travel has ground to a halt. In China’s Hubei province, which is at the center of the outbreak, about 55 million people have been quarantined since late January. But in the political and financial hubs of Beijing and Shanghai, travelers returning home from other parts of China are required to stay at home for two weeks, making trips between the cities nearly impossible.

One China-based executive at a Western bank who regularly flies between the two cities says he has been forced to hole up in Shanghai until restrictions were lifted. “If I continued making monthly trips, I would spend 14 days quarantined in Shanghai and 14 in Beijing. I would only work two days a month,” he says.

Another regular commute for bankers is between Hong Kong and Shenzhen. The mainland Chinese city just over the border from the territory is a tech hub that hosts companies such as telecom equipment multinational Huawei.

Chinese companies on the Shenzhen side are also important sources of business for capital markets activity in Hong Kong, which serves as China’s international financial center. But this month, the Hong Kong government imposed quarantine restrictions on anyone crossing into the territory, effectively closing the border.

Bankers, like other expats in Hong Kong and Beijing, have not only had their work but also their private lives disrupted. Schools in Hong Kong, for instance, have been closed since January, with the deadline for reopening extended until after Easter.

With business slow, many bankers in Hong Kong are growing frustrated. One banker bemoans being stuck at home on one of Hong Kong’s outlying islands. “I haven’t left the island in almost two weeks. I’m going crazy,” he says.

The adverse conditions have led many expatriate professionals to leave, with Hong Kong removal companies saying the outbreak has exacerbated an exodus started by anti-government protests in the city last year.

“We have more demand than staff,” says YB Ng, vice president at Hong Kong moving company Asian Tigers.

Steve Dressler of Trade Winds, a removal company for workers in the financial services sector, says expat professionals are not prepared to sign new rental leases. Instead, he is moving people out or helping them store their belongings as they go abroad to wait out the crisis.

Executive recruitment companies in the financial industry say the pipeline of overseas talent for Hong Kong and China is also drying up. Vince Natteri of Pinpoint Asia, a banking technology recruiter, says some clients in insurance and banking are canceling new appointments or pushing back start dates.

“It’s a tougher sell with this virus situation,” Natteri says. “It’s one thing to do interviews and quite another to come to Hong Kong.”

By Primrose Riordan and Don Weinland

OZY partners with the U.K.'s Financial Times to bring you premium analysis and features. © The Financial Times Limited 2020.

Sign up for the weekly newsletter!

Related Stories