BNP Paribas' McCappin on EVs, Bank's APAC Strategy

So what do you see as the opportunities? Let’s talk EVs first, then we’ll talk about the bank’s operations here in Asia. What do you think the investors opportunities are in the EV space after what’s been an EV kind of winter over the last six months or so? Sure. Steven, thanks for having me on. First of all, great to have Bloomberg with us on the floor here today and I should compliment you for organizing the sunshine here in Hong Kong. It’s been a little bleak. What isn’t bleak is the is the opportunity in the EV space. We know the world’s focused on AI. It’s natural. It’s been a very strong performing sector. But here at BNP, our researchers truly believe that there are some incredible opportunities in the EV space and we’re here today and tomorrow actually with some of our most important clients to talk specifically about those. And as you just mentioned, we’re following hard on the heels of the incredible automotive show in Beijing, which I’m very jealous you were at because I didn’t get to attend. And Hong Kong obviously plays its role as the capital raising Center for China, but also for a conduit into China. And these companies, we’ve seen a lot of EV makers and there’s probably going to be consolidation, there’s probably going to be M and A deals. And I know BMP Paribas was involved in, I believe the G Lee venture with was it Renault, So you’ve already had some exposure there. What kind of M&A in the EV space? And also if you can see IPOs coming down the pipe for Hong Kong in the EV space, EV space is very exciting. BNP is committed to carbon transition. This is a great subject for us to talk about. You highlight some of those opportunities. The opportunities are in consolidation for sure, but they’re also in manufacturing efficiencies and battery technology. And over the course of the next few days, we’re going to be talking about all those subjects with some of the leading experts. We have BYD on the automotive side, we have CATL on the battery side among many, many others. We’re going to be diving deep into those themes with our most important clients here as well as Mahindra and Mahindra and the Indians. So it’s not just China EV space as well. Let’s, let’s talk about what you are doing in the Asia Pacific. A bit of a, a different path towards China. We’ve seen some of the Wall Street banks like JP Morgan, Morgan Stanley, Goldman Sachs over the last couple of years pull back because the the deal flow has been cut. There’s been a dearth of of deal flows. And look there, there are some barriers, protectionist barriers happening with China and the United States, that bifurcation. But you’ve gone back into China with a securities venture after exiting 17 years ago. Can you give me the justification for that? Sure, there’s a lot going on globally and in the region. We’re guided by our clients. We’re seeing a lot of our clients in the region and globally actually looking for some diversification in their counterparty relations. BNP stands out as one of the leading European banks, if not the leading European bank. And and we’re happy to serve our clients in their needs here in Asia, in China, wherever it is actually. But that need for diversification, we see a lot and we’re just gradually and gently expanding into that where we see opportunities to help them. Where do you see the best opportunities through the securities venture that you’re going into and what kind of hiring are you talking about? Yeah, today’s a great example of that. So we’re gently cautiously expanding around our research and strategy within the equity franchise, picking subjects that we know well, that our exam team in Europe know well, where we can bring that expertise to our clients here in Asia. And as you mentioned, it’s not just China, the clients here today. In fact there’s there’s over 700 individual clients here with us today representing 150 individual investment firms who will spend time with 50, circa 50 companies and then from all over the region. In fact some people have travelled in from all over the world. So we’re hiring into that gently but cautiously, right. I mean look the the recovery if you want to call it that in China and Hong Kong and the equity side, yeah is starting, but we don’t know how long the legs will last obviously, right. So I would assume this securities venture will focus on the brokerages and and essentially A wealth management as well and maybe less on investment banking or what can you no as securities license which you’re referring to. We were very, very pleased to be granted recently and it’s a centerpiece of our research strategy in the region. As we grow the offering that we’re going to be providing to clients and today’s event and the focus on on EV and how core that is to BNP is, is an, is an is an excellent example of the sorts of expansion you’ll see from us. We’re going to pick themes, we’re going to pick subjects that we can offer expertise imported from Europe if if that’s what’s required, a lot of that today. And we’re going to be bringing that to our clients in region and that might necessitate us to hire a little around the edges, which we will be doing. How do you see the advantages that your bank has at a time, let’s face it and we’re not going to talk of geopolitics, but we do have Xi Jinping in Paris for two day, visit your French bank, you vaulted up the table in 2023 to #8 in the M&A space. I mentioned the Geely and Renault venture that you are part of. Is this a sweet spot for you right now given the geopolitics as well? Geopolitics is complicated for sure. I think I go back to that diversification point. We, we feel that our most important clients, whether they’re here in China, broader Asia or around the world are looking for BNP to be a more meaningful counterpart. They would like to see or like to have stronger relations with with a European provider and we’re really happy to fill that role and we’re going to be looking for opportunities such as this space to do that more. It’s a big focus for us.