Bank of America Corp. and Goldman Sachs Group Inc. are among financial firms cutting more than 1,300 workers in an effort to trim expenses and match revenue as equity and bond trading slows.
Bank of America, the biggest U.S. bank, cut about 60 positions in its equity-sales and trading division this month, said two people with knowledge of the decision. Goldman Sachs, the fifth-biggest U.S. bank by assets, plans to eliminate 230 jobs in New York starting in September, according to a filing the firm submitted to the state’s Department of Labor.
The firms join Barclays Plc and Credit Suisse Group AG, which are cutting investment-banking workers as they grapple with reduced revenue from buying and selling securities. Fixed-income trading revenue at U.S. banks probably dropped 30 percent in the second quarter from the previous three-month period, while equities trading fell 15 percent, Keith Horowitz, a Citigroup Inc. analyst, wrote in a report last week.
“From a sales and trading perspective, the results will be ahead of last year’s second quarter, but below the seasonally strong first quarter,” Bruce Thompson, Bank of America’s finance chief, said yesterday in a conference call with analysts.
U.S. financial-industry jobs dropped to 7.61 million in May, according to the Bureau of Labor Statistics. They fell for the fourth straight year to an average of 7.63 million in 2010, about 8.4 percent below the 2006 peak.
Credit Suisse Group AG, the second-biggest Swiss lender, is planning to cut more than 600 jobs in its investment bank, including more than 100 in the London office, while Royal Bank of Scotland Group Plc is paring about 200 jobs at its investment-banking unit in the U.K. and Europe, according to people briefed on the firms’ plans.
Lloyds Banking Group Plc, Britain’s biggest mortgage lender, said today it will cut 15,000 jobs and reduce costs by an additional 1.5 billion pounds ($2.4 billion) by 2014. HSBC Holdings Plc, Europe’s largest bank, will also cut about 700 employees who offer advice on financial products in branches, a person briefed on the talks said today.
Barclays Capital, the investment-banking unit of London- based Barclays, eliminated 100 jobs in June, according to people with knowledge of the firm’s plans. Barclays said in April that pretax profit at its investment bank fell 33 percent as revenue from fixed-income, currencies and commodities trading tumbled.
Bank of America, based in Charlotte, North Carolina, sought to trim its least-productive employees around the world with its cuts, said the people. The equities division employs about 2,500 globally, one of the people said.
Goldman Sachs, which didn’t identify what kinds of jobs it will be eliminating between Sept. 26 and March 31, cited economic reasons for the cuts, according to the filing.
In a separate filing this week, Bank of New York Mellon Corp. notified the New York state labor department of plans to start cutting 124 jobs in its treasury-services operations lockbox. The cuts will take place in stages beginning July 1 and continue through March 31, the filing said. Spokesmen from the banks declined to comment.
© Copyright 2014 Bloomberg News. All rights reserved.