Mr Warburton and Mr Kambe’s appointments follow the promotion of four Australian BofA managing directors in the last five months, who saw their roles enlarged to APAC status from local ones.
Half of Asia-Pacific’s 10 largest announced M&A transactions last year involved Australian assets or local companies conducting cross-border deals, such as Brookfield and EIG Partners’ $18.2 billion purchase of Origin Energy.
BofA’s decision to elevate its senior Australians is also a nod to the bank’s – and by extension, the country’s – pool of experienced dealmakers.
“It is simply a reflection of where the best person is in the region to do the job in hand, unencumbered by geography,” said Dan Janes, BofA’s head of Australian investment banking since February, when country head Joe Fayyad handed over responsibilities to him.
Mark Warburton was named a vice chairman for BofA’s APAC investment bank. Peter Rae.
The promotion of some of its most loyal local lieutenants contrasts with most Wall Street banks, which usually have Australian investment bankers reporting to regional sector heads in financial centres such as Singapore and Hong Kong.
BofA named Chad Karpes co-head of debt capital markets for Asia-Pacific, alongside Hong Kong-based Conan Tam, in May. Sydney-based Mike Hobby was appointed BofA’s co-head of leveraged finance for the region, and will share responsibilities with Singapore-based co-head Bhavik Pandya.
The promotions of Mr Karpes and Mr Hobby come approximately four months after Michael Evans joined Japan-based banker Tamao Sasada as BofA’s co-heads for Asian financial institutions, and Karl Rozman was asked to co-lead natural resources and energy transition for the region with Hong Kong-based Dan Yuan.
“When you boil it down, the numbers illuminate the importance of Australia. This is reinforced by an often outsized share of large-cap deals,” said Mr Janes, adding that the country was the third-largest fee pool in Asia, behind China and Japan.
In the first half of this year, two of the 10 biggest transactions involved an Australian slant.
BofA’s investment banking strategy of targeting larger, local deals was further vindicated this week when it snared a role advising TPG Telecom on the sale and leaseback of its non-mobile fibre assets with Macquarie-backed Vocus. The sale to Vocus, which could value the assets at roughly $6.3 billion, comes after BofA conducted similar transactions for Singtel and Optus and TPG’s mobile towers portfolio.
More frequent flyer miles
Bankers often bemoan the travel time to-and-from Australia. That is one of the reasons why global investment banks install Asia-Pacific heads elsewhere.
Gautam Chari, BofA’s head of capital commitments for APAC. Peter Rae
“Connectivity is not just about physical presence, but more about a team-oriented culture, irrespective of where you are physically,” said Gautam Chari, BofA’s head of capital commitments for APAC. Sydney-based Mr Chari was promoted to an APAC role in March last year.
Most bankers agree, however, a handshake trumps Zoom small talk. And BofA’s regional heads have acquiesced to more miles.
Mr Evans, the US bank’s co-head of APAC financial institutions who covers clients from India to Japan, said face-to-face meetings were critical. Natural resources head Mr Rozman added that the extra air miles were not much more than heading to Western Australia.
“It just means slightly longer flights when travelling in Asia … not that different to heading over to Perth every couple of weeks,” Mr Rozman said.
Adrienne Bloom, who leads the region’s financial institutions group at BofA’s corporate bank, said additional travel was par for the course for any global investment bank.
Adrienne Bloom, head of financial institutions for APAC. Peter Rae
“In-person meetings are still best to develop relationships with clients and colleagues. Yes, [it means] longer hours around other countries. As a global bank, this is something we manage,” she said.
Applying a co-head structure in Australia is also part of BofA’s quest to win regional market share. Mr Karpes, who joined BofA in 2010 to establish the bank’s work in the local bond market, said being a co-head helped connect Australian clients internationally, but also enabled him to talk shop with his colleagues around Asia.
“The co-head structure is beneficial in the sense it enables consistent focus across key regions – Australia, Japan, greater China, Singapore, Korea and South-East Asia,” he said.
“Notwithstanding, I am used to the travelling … and will no doubt be spending more time in these regions.”
Tapping the sell-side
Like most foreign investment banks operating in Australia, BofA does not try to be all things to all industries.
Mr Janes, the investment banking head, said telecommunications, technology, healthcare, financial institutions and natural resources were the sweet spots for the US bank.
The transactions are large, thus enabling BofA to use its gargantuan balance sheet and welcome deep-pocketed international businesses. Case in point: BofA advised Canadian gold miner Newmont on its $26.6 billion agreement to buy Newcrest in January.
Mr Janes also said his team had seen a “significant rise” in advising potential sellers, similar to the work BofA did for Glencore when it sold the CSA copper mine last year.
“One of the key areas … is in the number of sell-side roles, reflecting the importance of knowing both local and international bidders,” he said.
Like its bulge bracket peers Citi and JPMorgan, BofA is hinging its success in Australia on the ease with which it can combine debt or equity capital markets with advisory capabilities. And having a series of senior, region-wide bankers at the beck and call of Australian clients should help it climb the league tables. BofA had the seventh-highest fee intake in the first half of the year for Australian mergers and acquisitions, per Dealogic.
“Australia is important on both the regional and global stage. Not only does it benefit from having the resources the world needs … it also has fostered global leaders on the world stage,” Mr Janes said.
Source: afr.com
