BarCap cuts jobs, slowdown set to squeeze banks

BarCap cuts jobs, slowdown set to squeeze banks
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First Published: Wed, Aug 11 2010. 02 28 PM IST
Updated: Wed, Aug 11 2010. 02 28 PM IST
London: Barclays Capital is to cut jobs in Asia, Europe and the US after a slowdown in activity, a source said, in a move bankers expect to be matched by rival investment banks if market conditions stay tough.
Barclays Capital, the investment bank arm of British lender Barclays Plc, will cut about 400 back-office jobs, a person familiar with the matter said on Wednesday.
A spokesman for BarCap confirmed it had begun a consultation period with staff in some infrastructure functions “which will result in some job losses”. It will continue to hire selectively in parts of the business that are growing, he said.
BarCap has grown aggressively in the past two years, using the purchase of the US operations of Lehman Brothers to build an Asian and European equities and advisory business. It had 25,500 staff at end-June, up from 21,900 a year earlier.
BarCap’s revenues fell 15% in the second quarter from the first quarter, and many rivals saw even steeper falls as capital markets activity slumped in the euro-zone debt crisis.
Bank industry sources have said a quiet third quarter will result in job cuts across the industry. A dearth of deals and falling trading income will force banks to cut costs after an aggressive expansion in the previous year, bankers have said.
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First Published: Wed, Aug 11 2010. 02 28 PM IST