National Australia Bank to Hire Four for Asia Currencies Desk
March 15, 2010, 8:36 PM EDTBy Bob Chen
March 16 (Bloomberg) -- National Australia Bank Ltd., the country’s biggest lender, plans to hire four people for its new foreign-exchange business in Hong Kong this year, according to Bernard Yeung, head of currency trading for Asia.
Yeung, 36, joined the Melbourne-based bank two months ago to build up the department after being at HSBC Holdings Plc in Hong Kong for eight years. He reports to Tom Pragastis, global head of currencies and commodities trading based in Sydney, and is among about 25 people covering fixed income and risk management in Hong Kong. The bank has increased its focus on institutional investors after concentrating more on corporate and retail clients previously, Yeung said.
“Proprietary trading won’t be the focus, as we want to be more franchise driven and service clients,” he said in an interview yesterday. “Eventually, we hope to also build our foreign-exchange capabilities in Shanghai. That’s the two-year plan.”
National Australia reversed losses from trading in the last financial year on higher interest-rate and foreign-exchange volatility, the firm said Oct. 28. Trading income at the bank, which also operates the U.K.’s Clydesdale Bank Plc and Yorkshire Bank Plc, was A$828 million ($758 million) in the year ended Sept. 30, compared with a loss of A$148 million a year earlier, the bank said on Oct. 28.
The bank received less than 1 percent of its revenue from Asia as of September last year, according to company filings. That compares with 73 percent from Australia, 15 percent from Europe and 10 percent from New Zealand. The new roles will comprise of two traders and two salespeople, Yeung said.
Buy Asian Currencies
Yeung recommended investors buy Asian currencies against the dollar, euro and pound as foreign inflows will pick up and regional central banks will be less resistant to appreciation pressure once China allows the yuan to strengthen. He expects the currency to appreciate up to 5 percent this year, starting in the third or fourth quarter with a loosening of the trading band.
Democratic lawmakers, prodding President Barack Obama to take a tougher line on China’s currency, are drawing up legislation and convening hearings on the yuan’s effects on U.S. companies. The yuan rose 21 percent against the dollar from July 2005 to July 2008, before the government halted its advance to protect exporters.
“Overall, you’ve got to be short on the dollar against Asian currencies,” Yeung said, referring to bets that an asset will decline in value. “We’re in for some steep appreciation of the Asian currencies but might need China to move first on the yuan. The more external pressures weigh on China to do something, the less likely they’ll do it.”
--With assistance from Angus Whitley in Sydney. Editors: Sandy Hendry, James Regan
To contact the reporters on this story: Bob Chen in Hong Kong at bchen45@bloomberg.net.
To contact the editor responsible for this story: Sandy Hendry at shendry@bloomberg.net.
