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 […]

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

Reviews

Traders Union Experts Share The Trading Analyst Review For 2024

Navigating options trading in rapidly shifting markets poses a considerable challenge. This is where options trading alert services become invaluable. They aid traders in keeping abreast of evolving opportunities and market trends. In this assessment, Traders Union experts scrutinize The Trading Analyst alert service to ascertain its efficacy. 

Digital Assets

BlockDAG’s Presale Achieves $9.9M: Aiming For A 5000-Fold ROI As Cardano’s Price Rises And Fantom Launches Sonic

Explore Cardano’s surge, Sonic’s efficiency, and why BlockDAG’s growth makes it the top crypto choice. A deep dive into the future of blockchain investments.

Digital Assets

US, UK probe $20 billion Tether transfers tied to Russian exchange.

U.S. and UK authorities are investigating the movement of $20 billion in the USD-pegged stablecoin tether (USDT) through Moscow-based exchange Garantex.

Digital Assets

BlockDAG Presale Raises $9.9M as Batch 5 Nears Sell-Out Amid Bonk’s Fluctuating Trading Volume & Spell’s Bullish Price

Explore BONK’s trading volume, SPELL’s market shifts, and why BlockDAG’s 10,000 ROI makes it an ideal crypto for savvy investors in 2024.

Digital Assets

Bybit expands into Europe amid regulatory scrutiny

Dubai-based cryptocurrency exchange Bybit is expanding its operations in Europe after encountering regulatory challenges in Hong Kong.

Digital Assets

Cathie Wood’s sponsored Bitcoin ETF sees historic $200 million inflows

The ARK 21Shares Bitcoin ETF (ARKB), co-sponsored by Cathie Wood’s ARK Invest, registered historic inflows exceeding $200 million on Wednesday, signaling a robust appetite among investors for Bitcoin-centric investments.

Digital Assets

Sam Bankman-Fried might see his 25-year sentence halved

Sam Bankman-Fried, the founder of the failed cryptocurrency exchange FTX, was sentenced to 25 years in federal prison by a Manhattan court on Thursday. This comes after he was convicted of defrauding customers and investors, with Judge Lewis Kaplan highlighting the potential future risks posed by Bankman-Fried.

Technical Analysis

EURJPY Technical Analysis Report 28 March, 2024

EURJPY currency pair under the bearish pressure after the pair reversed down from the major resistance level 164.25, which also stopped the sharp weekly uptrend at the end of last year,

Digital Assets

BlockDAG’s Presale Hits $9.9M, MultiversX & MINA Price Predictions Show Green

Read about BlockDAG’s promising $10 prediction and insights on MultiversX Price Prediction as MINA’s potential unfolds.

<