Financial markets have been rocked by a further series of massive job reductions at top firms, including Credit Suisse, Nomura, Commerzbank/Dresdner Kleinwort, State Street, and Jefferies.
The deepest cuts will be made at Credit Suisse, which has outlined plans to axe 5300 staff, or eleven per cent of its global workforce. The Swiss bank says the redundancy programme will help save £1.1 billion or about nine nine per cent of its total costs.
The restructuring was announced as the bank revealed Sfr3 billion in fourth quarter losses and announced plans to exit certain proprietary and principal trading activities and scale back its operations in more complex structured products.
Most of the cuts will come from the investment banking division, which employs 20,000 staff worldwide. The 5300 total includes the 650 redundancies already announced in London this week. The rest of the cuts will be achieved by the end of the second half of 2009 and will incur a charge of Sfr900 million. Rumours are rife that an additional 1400 contractors, mostly in support functions such as IT, will also be shown the door.
Last night, Nomura revealed that it will cut 1000 jobs in London after completing a strategic review of the European operations of Lehman Brothers. The cull - which will impact both front office and back office staff - will be completed by the end of the first quarter 2009.
Another London merger casualty is the M&A unit of Dresdner Kleinwort, which is to be shuttered by new owner Commerzbank, with the loss of 1200 jobs.
In the US, meanwhile, State Street signaled plans to shed some 1800 staff, or six per cent of its global workforce. The reductions will largely be achieved by consolidating middle and senior management ranks. Two-thirds of the cuts will occur within North America with the remainder in Europe and the Asia-Pacific region.
Speaking at a Merrill Lynch conference last month, State Street CEO Ron Logue said the firm had developed an "aggressive" set of policies to manage headcount and related IT expenses over the coming year. Outlining the plans, he said the business would look to use more IT contractors and cut back on its $1.3 billion technology budget in 2009.
There was more misery in the US, as New York-based broker Jefferies said it would end 2008 with approximately 2150 employees, as compared to 2508 at the beginning of this year and would close offices in Dubai, Singapore and Tokyo.
And there could be worse to come, as speculation grows that Bank of America will slash 30,000 jobs from the payroll as it begins its merger with Merrill Lynch in the coming weeks.