DESPITE the broad market opening, the hundreds of new hires and the billions invested, JPMorgan Chase & Co. and other global investment banks posted a combined loss of about 308 million yuan (US$48 million) last year. Three firms eked out tiny profits from their onshore joint ventures and three had losses. By contrast, China’s investment banks rode a wave of deal-making to earn US$24.4 billion, according to filings. While the trend is promising — revenue is rising and a few banks reversed losses from previous years — the mediocre results show that Wall Street firms still need more time, talent and even bigger investments to post meaningful earnings in the world’s second-biggest economy. “While China is a strategic market for global banks they can’t afford to miss, reaping handsome profits here is another thing,” said May Zhao, deputy head of research at Zhongtai Financial International Ltd., a Hong Kong-based brokerage. “Winning clients, either from wealth management or investment banking, is challenging in a highly concentrated market gripped by top Chinese brokers.” For the investment banking giants, there’s no bigger opportunity than the US$54 trillion financial services market in China. The government has gradually allowed firms to take full control of their partnerships with local brokers, while giving them a green light to set up their own asset management companies. The banks are rushing in. The U.S. firms alone boosted their China exposure to US$77.8 billion last year, and are hiring hundreds of staff. Many companies have announced pledges to seek 100 percent of their joint ventures after China removed the caps in April 2020, and several have had 51 percent stakes for a few years. Yet for most, gaining control hasn’t yielded much in the way of earnings, and the foreign ventures remain minnows compared with local players like Citic Securities Co. and Haitong Securities Co. (SD-Agencies) | 