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BANKING

Why the China rainmaker just won’t go away

China’s rainmakers just won’t go away, even though most investment banks now hate the term and stress that it is the bank, and not the individual, that wins mandates. But the superstar bankers are still vital to doing deals in China. The old names hold on to key positions, while a new breed of dealmaker rises to the top of the ranks. Which firms have got their strategy right?

The ins and outs of mandate hunting


Every major investment bank in Asia seeks the answer to the key question: how do you win business in China? For most of the past decade, the answer was to have a rainmaker – an insider with serious connections to the Chinese establishment. Reports of the rainmakers’ death have been greatly exaggerated.

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IN THE FLUID and competitive world of China investment banking, new hires come and go, but occasionally one comes along that rattles the market. One such emerged in February when Merrill Lynch hired Margaret Ren, the former Citigroup China chief, to chair its China investment banking operations.

This is a bold and surprising appointment. Ren is arguably the ultimate rainmaker: bankers with such exceptional relationships that they can bring in big mandates for houses that might otherwise have no right to expect them. The daughter-in-law of former premier Zhao Ziyang, Ren proved her contacts and persuasiveness time and again at Bear Stearns and Citigroup. Her successes in getting Bear Stearns on to IPO and secondary issues for such names as China Telecom and Guangshen Railway in the late 1990s, when the bank had no meaningful China investment banking presence to speak of, are widely considered the most extraordinary examples of leveraging relationships the China market has ever seen.