Sydney: Bank of America / Merrill Lynch aims to add more senior investment bankers to boost its corporate advisory business in Australia, after expanding staff by about 25% this year, a senior company official said on Monday.
BoA/Merrill is keen to lift corporate lending to help firms in their M&A pursuits in the country.
“We have more than doubled our lending limits in Australia,” Kevin Skelton, head of investment banking at BoA/Merrill Lynch said in an interview, referring to the bank’s ceiling for corporate lending in the country.
“We want to use the weight of the balance sheet where it makes sense. It also means we can underwrite large transactions,” said Skelton, who has spent over two decades with Merrill Lynch.
He declined to give the actual dollar value of BoA/Merrill’s lending in Australia. “As a firm we are underinvested in Australia on a corporate lending basis. So, we want to increase lending,” he added.
BoA/Merrill was part of a syndicate that recently helped packaging group Amcor Ltd to raise debt to buy some of Rio Tinto Ltd’s packaging assets.
Skelton is also building up the team after last year’s global takeover of Merrill Lynch by Bank of America sparked uncertainty among Merrill’s staff and the company slid in deal rankings.
The bank is ranked 19th in Australian M&A league table for 2009, according to Thomson Reuters data.
Most investment banks are stepping up local hiring but BoA/Merrill has been among the most aggressive after it lost staff last year. Boa/Merrill hired a ten-member property banking team from rival UBS last month.
Skelton, an avid surfer, has been on an hiring spree over the past few months as BoA/Merrill bets on a recovery in M&A, initial public offerings (IPOs) and bond issuances.
Skelton however said BoA/Merrill was done with bulk of its big hiring for this year.
“We will be doing selective hiring going forward, rather than mass hiring. More in the equity research area. In the investment banking area, we are looking for senior M&A bankers,” he added.
The bank has expanded its infrastructure team, anticipating a pick-up in activity in that area and named Guy Foster, a former UBS banker, to head its equity capital market.
BoA/Merrill recently won a mandate to sell BHP Billiton Ltd’s Ravensthorpe Nickel project in Western Australia. It also won the advisory role, as part of a consortium, to advise Queensland government on its proposed A$15 billion asset sales.
Skelton expects a series of IPOs in Australia, just as new listings boom in Asia.
“The Myer IPO will be a bellweather for the Australian market. We expect there will be a series of IPOs particularly from the private equity,” Skelton said, adding he expects to see up to A$15 billion in IPOs over the next 12-18 months.
Australia’s top department store Myer has announced to list its business.