Biggest Investment Banks Cut More Jobs in 2024 After Brutal Year – Financial News

By Paul Clarke

From financial news

The world’s largest investment banks continue to brutally reduce headcount in 2024 as cost reduction remains on the agenda despite rising transaction fees.

The top 12 investment banks cut another 100 frontline dealmaker jobs during the first quarter of 2024, according to figures provided to Financial News by analytics firm Coalition Greenwich.

Eric Li, research director at the Greenwich Coalition, said large investment banks also reduced headcount in the second quarter.

“We expect banks to reduce headcount in the first quarter as that is when bonuses are paid, but we expect similar attrition in the second quarter, which is unprecedented,” he said.

Banks included in the Coalition Greenwich index are: Bank of America, Barclays, BNP Paribas, Citigroup, Deutsche Bank, Goldman Sachs, HSBC, JPMorgan, Morgan Stanley, Societe Generale, UBS and Wells Fargo. All banks have been contacted for comment.

Barclays said it was cutting hundreds of jobs at its investment bank in May, with around 100 positions lost in its trading unit. Bank of America thinned its ranks in January with job cuts at its investment bank, while BNP Paribas booked 50 redundancies across its UK business at the end of April.

Meanwhile, UBS’ acquisition of Credit Suisse in March last year will result in job cuts throughout 2024, with the bank planning five waves of layoffs starting in June.

These top banks employed 17,400 investment bankers at the end of the first quarter, a drop of about 1,000 since the end of 2021, when an unprecedented business boom forced most firms to hire senior traders.

“Investment banks remain focused on costs,” Li said. “What we’ve seen is that while the big banks are cutting back, smaller boutiques and other investment banks are embracing them. About 60 of those who lost their jobs have found new jobs elsewhere. It’s a great opportunity for them to find talent that would otherwise be too expensive to rent.”

Last year, Wall Street’s big banks cut thousands of jobs across their businesses as business fell for the second year in a row.

Goldman Sachs revealed plans for 3,000 job cuts in January and followed up with about 250 managing director layoffs in June. Meanwhile, Morgan Stanley cut about 3,500 positions in June last year.

Citigroup has cut thousands of jobs throughout 2023, but its structural review revealed in September, code-named Project Bora Bora, meant around 20,000 more roles were reserved for the next two years. It also made key hires, including former JPMorgan trader Vis Raghavan as head of banking.

Logan Naidu, chief executive of specialist recruiters Dartmouth Partners, said that after 12 to 18 months of cost cutting there had been some “rays of sunshine” around banker hiring.

“It’s bottoming out for the first time in over a year,” he said. “M&A recruitment is increasing and there is some appetite to hire capital markets bankers, but this is coming from a low base.”

Financial News is owned by News Corp, parent company of The Wall Street Journal and Dow Jones Newswires.

Write to Paul Clarke at paul.clarke@dowjones.com

Website: www.fnlondon.com

(END) Dow Jones Newswires

June 24, 2024, 9:08 am ET (1:08 pm GMT)

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