It’s all about access. The sell-side firms that rank highest on Institutional Investor’s inaugural All-China Sales Team — China International Capital Corp. in first place, followed by Bank of America Merrill Lynch in second and UBS in third — impress clients with their ability to arrange meetings and interviews with leading executives at Chinese companies.
“CICC’s corporate access in China is better than other sell-side firms’,” declares one advocate. (The names of those surveyed and the institutions they work for are kept confidential to ensure their continuing cooperation.) “They’ve established very strong relationships with government officials as well. We’re very happy with the field trips organized by CICC — they’re able to set up one-on-one meetings with companies even in blackout periods, one month before earnings conference calls.”
Observes another satisfied customer: “CICC is capable of providing the widest corporate access to Chinese listed companies.”
The firm takes special pride in being able to arrange those meetings, according to Hong Liang, co-head of sales and trading. Vice premier Qishan Wang helped establish CICC in 1995 as a joint venture primarily between China Construction Bank, where he served as governor, and Morgan Stanley. With such a pedigree, “we have unparalleled access to many important Chinese companies and regulators, as well as many leading academics and experts on China,” says Liang, who is headquartered in Hong Kong. “For the largest ten initial public offerings of Chinese companies listed in Hong Kong, CICC underwrote nine of them.”
The team consists of 106 salespeople, with 70 in mainland China and the rest working out of offices in Hong Kong, London, New York and Singapore. “Our sales staff strives to work seamlessly together as one team so that we can provide the most in-depth and the most updated research and market color on China to our clients, both in mainland and overseas markets,” Liang says. “We have a top-tier market share in both the domestic, A-share market as well as the Hong Kong market. None of our competitors has this cross-border market presence yet.”
Portfolio managers are impressed. “CICC always offers high-quality and efficient service,” says one. “Their team is really professional, experienced and diligent.”
BofA Merrill’s salespeople win praise for many of the same attributes. “Their prompt comments after the release of data or an event indicate their professionalism,” says one Hong Kong–based investor. “They also organize company visits and share insights into their research, which is very helpful.”
Richard Boseley, head of Asia-Pacific equity sales in Hong Kong, directs the 100-strong squad (whose members serve clients of not only Chinese equities research but all of Asia ex-Japan). The team has members stationed in Hong Kong, London, Melbourne, Mumbai, New York, San Francisco, Seoul, Singapore, Sydney and Taipei.
“We run country and generalist sales teams with a sector overlay — highly experienced teams focused on regional real estate, financial institutions, consumer, resources and technology,” Boseley explains. “We have continued to invest in and refine the quality and value of our corporate access offering, and to ensure it is wholly focused on providing our clients with the best insight possible to make their investment decisions.”
Some survey participants single out individuals for special recognition. “Patrick Doyle is one of the best at keeping us up to date on relevant issues in China,” observes one U.S.-based booster. “He obviously works closely with the research analysts, and this seamless coverage from BofA Merrill is valued given our time zone constraints.”
Adds another: “Krista Yue helps arrange corporate and analyst meetings, and updates me regularly even though she is based in Hong Kong. She also follows up quickly with any data requests I have.”
One client isn’t afraid to show BofA Merrill the money: “As manager of $2.5 billion in Asian equities, we are very careful with our commissions, and it is unusual to break into our commission totals. A salesman the caliber of Jon Connor was the key.”
Members of the UBS crew garner comparable plaudits from their customers. “Matthew Chapin is the best on China — indeed, all of Asia — sales,” says one. “He has a very impressive understanding of the nuances of the market, and of the strengths and weaknesses of his research department. He does an outstanding job of leveraging all of UBS’s resources — economics, strategy, fixed income and currency — in all markets to put China in the clearest perspective. He adds tremendous value.”
The whole sales team “has been able to communicate clearly the ideas from their research department and well as giving us insights on stock ideas,” affirms another supporter.
UBS has 65 research salespeople on its Asia team (which includes China), and they work out of offices on the mainland (Beijing and Shanghai) as well as in Hong Kong, India, Indonesia, Malaysia, the Philippines, Singapore, South Korea, Taiwan, the U.K. and the U.S., according to Shane Gunther, Hong Kong–based head of Asian equity sales.
“Clients are increasingly looking for differentiated corporate and expert access,” Gunther says.
And the firm delivers, money managers insist. “UBS has committed more resources to China than any other sell-side firm — and it shows,” proclaims one buy-side enthusiast. “Its China sales team reflects one of the deepest benches in the industry, and their service is in a class of its own.”
In conjunction with 2012 All-China Research Team, we asked survey participants to tell us which firms field the best sales forces in China. This ranking reflects the opinions of roughly 1,400 buy-side analysts and money managers at some 580 firms that collectively manage an estimated $703 billion in Chinese equity assets; roughly 69 percent of the people who cast votes in the research team survey, representing 83 percent of the participating buy-side institutions, answered our question about the best sales teams.