Alvarez & Marsal Holdings LLC hired a team of about 40 professionals in China in its biggest ever recruitment round in the country, betting deals will pick up as global private equity funds regain their appetite for assets in the world’s second-biggest economy.

On the other hand, Alvarez & Marsal, a New York-based advisor, has doubled its China team to 90 professionals in its transaction advisory service in the past six months, Paul Aversano, managing director and global practice leader of the advisory group, said in an interview. The recent addition is expected to help the division double revenue in the region within 12 months, he said.

“How could we ignore the country, given its size and its growing influence on the global stage”, he said, betting the dry powder accumulated by multi-billion dollar private equity funds will take “several years” to be deployed. The firm is taking a “long-term” view and isn’t deterred by rising geopolitical tension and the regulatory crackdown in China, he said.

The rapid expansion comes at odd with the recent cuts made by Wall Street banks such as JPMorgan Chase & Co., Morgan Stanley and Goldman Sachs Group Inc., as China dealmaking plummeted more than 80 percent last year amid U.S.-China tensions and a crackdown on private enterprise. Economists expect gross domestic product growth to rebound to above 5 percent this year from just 3 percent last year, with signs so far pointing to a recovery that’s gathering pace.

A&M is taking a “significant” number people of the Shanghai team from Ernst & Young LLP as the professional service firm is splitting its auditing and consulting businesses to avoid conflicts of interest, Aversano said. China’s transaction advisory team makes up the bulk of Asia which has about 150 professionals, including 50 in India.

The recent hires included seven managing directors and 32 professionals. The firm also operates in other businesses areas, including restructuring, disputes and investigations and helping with corporate operations performance with about 550 staffers in Asia.

The firm’s China headcount boost is defying skepticism among some global investors who have become more hesitant to boost allocations in Asia, and China in particular as tensions with U.S. has ratcheted up over trade, human rights, technology and Taiwan. Slumping financial markets last year also make it harder to exit investments, stunting China-related deal flows.

Global funds, including US investors who were on the sidelines last year, are likely to start allocating capital soon, albeit at a measured pace, said Xuong Liu, Hong Kong-based managing director who co-leads the practice with Stella Yuan, who recently joined from EY in Shanghai and brought seven managing directors and 32 professionals with her.

“We are seeing them pivot much more back to what they’re hired to do, which is invest and allocate capital to China, said Liu. The firm is starting to see some “green shoots of recovery” after China removed its Covid Zero policies late last year and inquiries from clients that have relaunched stalled deals, he said.

Most famous as the restructuring adviser that wound down Lehman Brothers Holdings about a decade ago, the firm has been expanding its footprint in Asia where it now has 700 staff, or 10 percent of its global headcount. The transaction advisory team in China focuses on due diligence work for private equity firms and investment banks.

The firm has other businesses including restructuring, disputes and investigations and helping corporate improve operations performance and is also expanding in India and Southeast Asia.