Regulation, automation, volatility and low rates forcing banks to cut jobs, BNP Paribas to oust 675

Rick Steves

In recent years, the banking sector has been pursuing cuts in operation costs, to address issues such as increasing regulatory expenses, by selling parts of their businesses and branches, adopting more efficient technology, and reducing manpower, among others. Cutting on human resources may be accelerating as volatile financial markets have been affecting the banking business […]

BNP Paribas to reduce 675 positions

In recent years, the banking sector has been pursuing cuts in operation costs, to address issues such as increasing regulatory expenses, by selling parts of their businesses and branches, adopting more efficient technology, and reducing manpower, among others. Cutting on human resources may be accelerating as volatile financial markets have been affecting the banking business with tremendous effect, with a slump of 15% in market trading revenue in Q1 2016 only, when usually it is the most lucrative period. Deutsche Bank CFO said in March that the first two months were the worst start to a year for banks that he has seen in his banking career.

Most recently it has been reported the imminent 70 redundancies across Citigroup’s London trading units, adding to the incoming 200 jobs reduction in Europe, in operations and technology. The company has made public a plan to cut jobs by 30% within the next 10 years as adoption of automation increases.

Following a pre-tax loss of CHF 2.442 billion for the year of 2015, Credit Suisse Group AG (ADR) (NYSE:CS) it was reported in February that the group was preparing a 4,000 job cut, but further developments have come up since late March. The bank will add 2,000 to the redundancies plan, totaling 6,000 employees and targeting savings from CHF 3.5 billion to CHF 4.3 billion by the end of 2018.

CEO Tidjane Thiam said: “We are taking action to lower the cost base of Global Markets by reducing headcount by 2,000. This will drive a decline in the Global Markets’ cost base from USD 6.6 billion to USD 5.4 billion by end-2018.”

Nomura, Japan’s largest interbank brokerage, is set to close its derivatives business, reduce its European equities unit, and lose between 500 (Reuters estimate) and 1000 jobs (Nikkei estimate) following weaker numbers: net income down by 49% in Q3 2015. The restructuring plan will be announced following after the publication of the annual results of 2015.

Santander has announced in April a plan to save up to €3 billion by the end of 2018, consisting in closing 450 branches in Spain and make approximately 1,000 (3%) of employees redundant, totaling staff in branches and corporate center.

The most recent job cut announcement came from BNP Paribas, planning to reduce its investment banking division by 675, from a total of 30,000 approximately, with a focus on voluntary departures. The decision is expected to save up to €1 billion in annual costs at the securities unit by 2019, with plans to reduce spending in its investment banking business by 12%.

Pressure from tougher regulatory requirements, volatile markets and sharply low interest rates are forcing these decisions by investment banks, mostly European.

Read this next

Digital Assets

TRON approves Wintermute to mint, burn USDD stablecoin

TRON Reserve DAO has welcomed crypto market-making giant Wintermute as the ninth member and whitelisted institution to mint Tron network’s stablecoin, Decentralized USD (USDD).

Metaverse Gaming NFT

Nas Academy and Invisible College introduce innovative model for Web3 education

Singapore-based online learning platform, Nas Academy is joining forces with Invisible College to teach people everything they need to know about the Web3.

Digital Assets

Top exec at BitMEX pled guilty US Bank Act violations, pays $150K fine

BitMEX’s head of business development, Gregory Dwyer pled guilty to violating the US Bank Secrecy Act (BSA) and allowing customers to use the platform to circumvent the federal anti-money laundering rules.

Retail FX

CySEC slaps €150,000 fine on FXBFI, operator of 101investing brand

The Cyprus Securities and Exchange Commission (CySEC) today announced that it has reached a settlement with FXBFI Broker Financial Invest Ltd, trading as 101investing, ordering the firm to pay €150,000 for violating the Investment Services and Activities and Regulated Markets Law.

Retail FX

X Open Hub expands multi-asset offering with new cryptocurrencies and indices

X Open Hub, a multi-asset liquidity provider, announced today that it has extended its offering with inclusion of 30 new cryptocurrencies and two emerging market indices.

Retail FX

Interactive Brokers now offers 24/7 access to crypto trading

Interactive Brokers Group, Inc. (NASDAQ: IBKR) has widened access to cryptocurrency trading for its clients. Specifically, the discount broker extended trading hours for its cryptocurrency products to be traded 24/7, including on the weekends.

Inside View

Natural Language Generation for Multi-Language Social Media Strategies 

Natural Language Generation (NLG) is a crucial growth area in the digital landscape, with the unique potential to be used across multiple industries.

Market News, Technology

The B2Core Android App is Now Available For Download

The first version of the B2Core Android app is available for download, and it has many beneficial features for users.

Digital Assets

XBO taps custodian Fireblocks ahead of crypto exchange’s launch

XBO.com has integrated with digital asset and crypto technology platform Fireblocks ahead of the crypto exchange’s upcoming launch.

<