The interbank FX job cuts continue: Citigroup set to make 70 redundancies across its London trading desks
Citigroup Inc (NYSE:C) is preparing to make 70 redundancies across its London trading units in order to make some adjustment toward compensating for low trading revenue. During 2015, the company maintained its top spot as the leading interbank FX dealer with a market share of 16.1%, up from 16% in 2014, however due to the reduction […]
Citigroup Inc (NYSE:C) is preparing to make 70 redundancies across its London trading units in order to make some adjustment toward compensating for low trading revenue.
During 2015, the company maintained its top spot as the leading interbank FX dealer with a market share of 16.1%, up from 16% in 2014, however due to the reduction in revenue that has materialized and affected a number of banks over the last year, 70 traders and sales people within the firm’s London operations will be made redundant.
One of those affected contacted Bloomberg, and explained that in addition to headcount reduction in London, approximately 200 jobs in operations and technology across Europe may also be subject to the cost cutting exercise.
The company’s CFO, John Gerspach, made a statement in March this year that revenue in the first quarter of the year from fixed income and equity trading would possibly drop 15%.
Citigroup has concentrated on maintaining its number one slot as an interbank FX dealer, and has previously streamlined its operations to this effect.
In May last year, the firm sold its $30 billion per month retail FX trading division, CitiFX Pro to FXCM and Saxo Bank, with FXCM having taken on board the clients across North America, and Saxo Bank assuming the client book from CitiFX Pro’s operations in Singapore.
Interestingly, whilst cost cutting in terms of human resources at one of Citigroup’s most important divisions, the company’s dominance of the global FX markets being conducted from the interbank FX heartlands of London, whilst many traditional banks look to scale back their operations in light of a difficult 2015, Citigroup has been conducting research into the future, largely centered around the automation of many tasks.
The company recently issued a notice about “digital disruption” stating that investment in fintech by institutions has grown from $1.8 billion in 2010 (a lifetime ago in terms of the development cycles in fintech these days) to an astonishing $19 billion in 2015.
The report predicts that within the next ten years, 1.8 million positions of employment will become redundant purely due to the automation of retail banking.
Citigroup’s report drew the conclusion that a 30% reduction in human resources will take place over the next 10 years within financial institutions, largely down to automation.