News: Investment banks could cut 75,000 staff over the next five years

Employee Relations

Investment banks could cut 75,000 staff over the next five years

According to Roland Berger Consultants, up to 15 percent of the 500,000 jobs in investment banking could disappear in the next five years as the euro zone crisis and stiffer regulation hammers revenue, profitability and risk-taking. It suggests that investment banking global revenue is set to fall by 15 percent this year, while average return on equity could slide to 5 percent from 15 percent in 2010, fuelling the need to cut jobs. Firms from Morgan Stanley, which in July announced 1,000 more layoffs to meet a 7 percent staff reduction target, to Goldman Sachs are embarking on fresh rounds of staff cuts in their trading and underwriting businesses. Last week European powerhouse Deutsche Bank said it will cut an undisclosed number of jobs on top of 1,900 cuts already announced and pledged to end a risk-taking culture driven by short-term gain. Swiss banks UBS and Credit Suisse are in the process of making 3,500 job cuts each.

According to Roland Berger Consultants, up to 15 percent of the 500,000 jobs in investment banking could disappear in the next five years as the euro zone crisis and stiffer regulation hammers revenue, profitability and risk-taking. It suggests that investment banking global revenue is set to fall by 15 percent this year, while average return on equity could slide to 5 percent from 15 percent in 2010, fuelling the need to cut jobs. Firms from Morgan Stanley, which in July announced 1,000 more layoffs to meet a 7 percent staff reduction target, to Goldman Sachs are embarking on fresh rounds of staff cuts in their trading and underwriting businesses. Last week European powerhouse Deutsche Bank said it will cut an undisclosed number of jobs on top of 1,900 cuts already announced and pledged to end a risk-taking culture driven by short-term gain. Swiss banks UBS and Credit Suisse are in the process of making 3,500 job cuts each.

Source: The Economic Times 

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Topics: Employee Relations, #Updates

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