Barclays is the latest to join the cost-cutting bandwagon as it plans to eliminate as many as 2,000 jobs in its investment bank wing, as a part of its massive restructuring plan which also involved the hiring of Hector Sants, an ex-FSA chief as its compliance head, effective from January.
The Barclays job cuts will be announced early next year, which would entail axing of a small part of the Barclays’s total investment-banking workforce of roughly 23,000 full-time employees. Nonetheless, the sacking of investment bank employees, reflects the diminished allure world-wide of the investment-banking industry.
The job cuts in Barclays is likely to be concentrated in Asia and continental Europe, with Barclays executives aiming to protect the bank’s strong US and UK franchises. The Barclays ax is likely to fall especially hard on jobs in the bank’s equities sales and trading division in continental Europe and Asia, said sources familiar with Barclays’ plans.
Antony Jenkins, who was named chief executive of Barclays in August after the ouster of Robert Diamond amid the libor rate-rigging scandal, has been working on a broad corporate overhaul that he is set to unveil in mid-February.
Barclays cost-cutting measures remain in flux, and some senior executives are pushing for a more-aggressive purge, according to a source closely involved with the discussions.
Investment banks have been cutting several jobs in recent months, in an attempt to cope with a weak business environment and new regulations that are pressuring profits. Many banks have concluded that thinner profit margins make it no longer worthwhile to compete as second- or third-tier players.