Kevin Burke, Managing Director, Head of Distribution, Asia Pacific at Barclays Capital talks about growth and the beginnings of a return of investors' appetite for risk

Innovative Investor - What are your big themes for 2010?

Kevin Burke - A big theme for us in 2010 is continuing to improve access to product for our clients on a global basis. With market-leading products in Asia and our top tier business in Europe and the US, we have a great opportunity to provide our client base in Europe and the US with access to Asian products, and vice versa.

The most exciting thing for us this year is the build out of our cash equities business. Following our acquisition of the former Lehman US business we have established a cash equities business in both Europe and Japan and we are now turning our attention to Non-Japan Asia.

Innovative Investor - What are your clients saying to you at the moment?

Kevin Burke - One notable feature of the financial crisis was the importance of liquidity to clients, particularly the importance of resilient e-commerce platforms like BARX, our electronic trading platform, through which our clients can price and trade a range of asset classes and products online. We are continuing to invest in BARX to further enhance its product offering, as well as its functionality.

Regulation is another major challenge, especially in relation to the third-party and retail business. We have been working closely with the regulators on improving best practice with a particular focus on the education of both retail distributors and end clients in terms of product education and suitability.

Product suitability is also important for the institutional and corporate client base, particularly when dealing with small and medium-sized enterprises.

Innovative Investor - Are you looking to grow headcount in 2010?

Kevin Burke - We continue to have aspirational targets in terms of business growth, which will require us to increase our Distribution headcount in Asia Pacific by around 15%-20% per annum for the next few years.

Early 2009 offered an opportunity to hire talented people who had been displaced, but the current recruiting environment is much tighter.

Overall we've grown our Distribution headcount throughout the crisis and we have also brought senior management expertise into Asia Pacific from the US and Europe.

Innovative Investor - In which regions are you seeing most interest in structured products at the moment and in what products?

Kevin Burke - There is a lot of interest in emerging markets such as Brazil - especially in Japan among the high net worth client sector - given the positive macro-economic fundamentals in that country.

There is definitely a move to diversify away from the Yen - given its strength - into other markets. We continue to see a lot of interest in Australian dollars in addition to emerging market currencies such as the Brazilian Real and the South African Rand.

Innovative Investor - Why Japanese retail in particular?

Kevin Burke -Structured product distribution into Japanese retail has remained active. In non-Japan Asia, public offer and retail distribution has remained subdued while the regulators revise their regulatory framework governing such distribution.

Innovative Investor - What are clients demanding from products?

Kevin Burke - Transparency, liquidity and simplicity remain key requirements. We have seen a big pick up in interest in exchange-traded products globally. In Asia we launched our first iPath Exchange Traded Note (ETN) on the Singapore Exchange last December, which was the first ETN to have been launched in Non-Japan Asia. They are a simple way to get exposure to alternative assets - for example gold, base metals or commodity indices - in a transparent way with enhanced liquidity.

We are developing a broad range of iPath ETN products which will give investors access to a wide suite of asset classes. Singapore is the first exchange on which we have listed and we plan to roll out the iPath ETN product offering to other exchanges in the Asia Pacific region.

Innovative Investor - Have you seen the beginnings of a return to risk from investors?

Kevin Burke - We continue to see a pick up in client activity towards increasing risk. In markets such as Japan and Greater China we have seen a big pick up in activity in equities, as well as notable interest in credit across the region.

Innovative Investor - There are concerns about Beijing's exit strategy from its stimulus program and its impact on Asia and the rest of the world. Where do you stand on the issue of recovery?

Kevin Burke - Clearly we've come out of a period of unprecedented volatility. The markets were still very much in a state of flux at the beginning of last year, but the sheer scale of the government fiscal stimulus is now beginning to be felt and I think that market confidence is returning, albeit from a fragile base.

Clients are still looking for more clarity and direction from the markets. The US is still key in terms of the performance of its economy and the performance of the dollar because that will impact the performance of the markets in this region and globally.

China's fiscal stimulus has clearly been beneficial. However, investors have been monitoring the rhetoric around China reigning in its bank lending, which might have an impact on economic growth. One thing is for certain; clients are more confident and optimistic now versus this time last year.