00:00Philippa Gauri, co-head of global banking at JPMorgan.
00:03Good to have you back in the region.
00:04Thank you very much. It's a pleasure, always.
00:07Philippa, I mean, we talk about the uncertainties in the world.
00:10Has that fundamentally changed the way your clients think?
00:13Surprisingly not.
00:15When you and I met in Davos, there was the whole enthusiasm for how 2026 would pan out.
00:22And to a certain extent, it has delivered in that sense.
00:26If you look from a pure banking standpoint, volumes, wallet is up year-to-date around 30%.
00:36And notwithstanding all the potential geopolitical headwinds and so on and so forth,
00:42clients still are engaging in deal-making, opportunities, creating new companies and so on and so forth.
00:52And so the year remains exceptionally positive.
00:56But markets underpricing risk, you've said that before, and they continue to be.
01:01There is a concern that the markets are pricing for perfection.
01:08And it's a theme that you hear when you go around the world.
01:12I was in Europe last week and in Asia this week.
01:15People are looking around and saying, is this too perfect?
01:22So there is a little bit of a theme that people are asking, what about inflation?
01:26Is that, as Jamie said, the skunk at the party?
01:29Is there something there that could come and surprise people?
01:33So a little bit of that concern does exist.
01:36In terms of the growth markets, the last time we spoke, you were bullish Middle East.
01:40Of course, the situation there has changed somewhat.
01:43It remains, fundamentally, the Middle East remains an incredible growth story for the firm and more globally.
01:53There are a variety of different reasons why the Middle East will, in our opinion,
01:57will remain important, notwithstanding the current troubles.
02:02Yes, of course, things will need to settle down and there will be a period where things will need to
02:08recover.
02:08But we remain exceptionally positive on that part of the world, as well as the rest of Asia, obviously.
02:15How about the rest of the world, right?
02:16I mean, when you take a look at activity, it does seem like, when it comes to deals,
02:20outbound flows from Asia, from the Middle East to the U.S.
02:25Do you think that is sustainable, given where we are right now?
02:29It definitely remains a theme.
02:32And it's also a European to the U.S.
02:35You see that the rest of the world is looking at that fantastic engine of growth, which is the U
02:40.S. economy.
02:41And most CEOs, most companies, the question they often ask is,
02:45how do I become part of that incredible engine, which is the U.S. economy?
02:51So that looking west still does take place.
02:58Asia is booming, too.
03:01We are in China.
03:02What's happening with Hong Kong, China is super exciting, too.
03:05But people still look at the U.S.
03:07What is super exciting in Hong Kong and China?
03:11Well, look at the equity capital markets of Hong Kong and China have been booming this year.
03:17If you think about global equities, Asia, China represents around a third of the volumes that have been raised so
03:27far,
03:28in both volumes and also number of IPOs, which is remarkable.
03:33And if you see the activity, you feel that there is that sense of excitement coming from this part of
03:38the world.
03:38The world lived a few years, when I was still living in the region, where it went through a period
03:46of slowdown,
03:47but we have recovered with multiples, and the excitement is truly palpable.
03:52And at this event, when you have more than 3,000 delegates, it's incredible.
03:58We were just in Beijing last week for the Trump-Xi summit.
04:02It does seem like there's some stabilization in bilateral relations.
04:06Might that translate to more activities?
04:08I agree.
04:10And the fact that the summit took place is in itself very good news.
04:16And there is a sense of de-escalation, which we, of course, support as a firm,
04:22and that will be positive for deal-making, yes.
04:25And you talk about deal-making.
04:26There are certain sectors which are thriving more than others.
04:30AI is one.
04:32How are we looking at that in terms of the risks involved?
04:35I mean, this perpetual debate of AI capex?
04:40So it is a topic that is heavily discussed in the U.S., but AI is for real, and it
04:49does change.
04:51It's a giant leap of mankind in terms of revolution of what we can and cannot do.
04:56So it's there to stay.
04:58The investments are definitely important, and what it will create also socially in terms of changes to the labor force
05:07is important too.
05:08But it's something like it's there to stay, and we need to be prepared for it.
05:14And how are you looking at the capex?
05:16We just had NVIDIA out with earnings, met expectations.
05:19You know, market's still a bit disappointed.
05:21When you take a look at the capex, plans are intact.
05:25Three to four trillion dollars.
05:27That's inflationary.
05:29I would agree with you, yes.
05:32So the longer-term impact of productivity growth that will come out of AI will be deflationary.
05:41But in the short term, the capex and the build-out that is happening around data center and some of
05:47the other affiliated topics has to be inflationary.
05:53Still, in the end, you're pretty optimistic about the business.
05:56How are you positioning corporate banking in…
05:59So we keep on growing both globally and in Asia-Pacific.
06:04We're investing in bankers, covering more corporates, more bankers onshore in all the countries that we operate in in the
06:13region.
06:14This is a region that is very close to my heart, having spent 12 years here.
06:20And it's a region that keeps on growing enormously.
06:23And if you look at the headcount, for instance, in the mainland, it has doubled over the last eight years.
06:28Revenues have grown 20% per annum over the last two years.
06:32So that growth of this part of the world is palpable and we will keep investing in this part of
06:37the world.
06:38And planning to hire more?
06:39Yes.
06:39How many more?
06:40Where?
06:41Come on, Filippo.
06:43The part of the region that is interesting globally is, of course, the mainland, Hong Kong, China.
06:52Sorry, the mainland, Hong Kong, Japan.
06:56There is a lot going on, M&A, defense and activism in Japan, equities, Hong Kong, China.
07:03So there is more that we can do.
07:05So hiring more in these markets, just to be fair.
07:07Bye.
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