Looking to Expand in Asia, Goldman Sachs Establishes Hong Kong Presence

ThemeS: Globalization | Culture

Interior of Hong Kong office, circa 2000.

Goldman Sachs opens an office in Hong Kong in 1983, recognizing the role of the port territory as a vital financial bridge for the entire Asian region.  

The colony of Hong Kong, a territory in southeastern China, had first been ceded to the British by China under the Treaty of Nanking in 1842. The vibrant port quickly became an important center of commerce and banking, and served as a commercial gateway to China and the rest of Asia. 1984 marked a landmark agreement between Great Britain and China in which British Prime Minister Margaret Thatcher committed to the UK’s surrender of Hong Kong to China in 1997 under a “one country, two systems” formula proposed by Chinese leader Deng Xiaoping, whereby Hong Kong would continue to operate under a capitalist system for 50 years.

Goldman Sachs opened an office in Hong Kong in October of 1983, with an initial focus on investment banking activities and an overarching objective of establishing the Goldman Sachs name in the region. The same month, the firm’s Tokyo representative office (first opened in 1974) was converted into a full-service, multi-divisional office. At the time, the firm had a substantial fixed income sales presence in Tokyo that encompassed accounts across Asia.

Within a year, and with only two employees, Goldman Sachs reaped the benefits of an on-the-ground presence in Hong Kong. The firm offered the commercial paper notes of the Mass Transit Railway Corporation in 1984, the first time a Hong Kong corporation issued commercial paper in the United States. Also in 1984, the firm was asked to assist two of the most important organizations in Hong Kong at the time: The Hongkong and Shanghai Banking Corporation (HSBC) and Hongkong Land.

By late 1989, the office had grown to 15 employees. A year later, the equities division was established and investment banking activities expanded. In 1992, both research and principal investment activities were initiated, and in 1993 a specialized capital markets group was formed and the firm’s J. Aron division established substantial commodities, currency and derivatives operations in the Hong Kong office.

That same year, Goldman Sachs completed a block trade of more than six million American Depositary Shares of News Corporation on behalf of Hong Kong’s Hutchison Whampoa Limited and the Li Family. The US$290 million transaction was one of the largest block trades ever executed in Asia. The firm also advised Hutchison Whampoa Limited in the sale of an interest in StarTV to News Corporation that year. By the end of 1993, Hong Kong served as the regional hub for Goldman Sachs’ rapidly growing presence in other parts of Asia. (The firm had opened a Singapore office in 1989 and would open two offices in Mainland China—in Beijing and Shanghai—in 1994.)

In 1999, Goldman Sachs advised the Hong Kong government on the initial disposal of shares it purchased in August 1998 to deter the attack on the region’s financial markets following the 1997 Asian Financial Crisis. The firm was then joint global coordinator for the US$4.3 billion IPO of the Tracker Fund of Hong Kong (TraHK), an innovative exchange-traded investment fund tracking the Hang Seng index. In 2000, Goldman Sachs also served as joint financial advisor and joint underwriter in the IPO of a 23 percent stake of the Mass Transit Railway Corporation.

In 2010, the firm served crucial roles in the largest-ever Hong Kong IPO (US$20.5 billion), that of insurer AIA Group Limited, the main Asian subsidiary of American International Group (AIG). The Hong Kong office continues to be a critical conduit between the firm’s Chinese and other Asian clients and global investors and is the largest office in the Asia Pacific region. In 2018 alone, the firm raised US$110 billion for these clients through the Hong Kong office.


This article was originally published as part of a series commemorating the 150th anniversary of Goldman Sachs' founding in 1869.