Bloomberg News

Credit Suisse Said to Plan 100 Job Cuts at U.K. Investment Bank

June 29, 2011

June 29 (Bloomberg) -- Credit Suisse Group AG, the second- biggest Swiss bank, may cut about 100 jobs at its investment bank in the U.K. as part of a global staff-reduction plan, said a person familiar with the matter.

The reduction includes most of the 40 managing directors and directors the bank is eliminating across Europe, said two more people familiar with the situation who declined to be identified as details are private. More than 20 managing directors have been told their positions are being reviewed. About five have already left since the Zurich-based bank announced bonuses earlier this year, the people said.

“Even banks that had a comparatively good financial crisis are now being forced to cut costs,” said John Axworthy, partner at recruitment firm J. Robert Scott in London. “Non-performing managing directors are particularly exposed. We expect other bulge brackets to go down the same route.”

Global investment banking revenue may fall by about 16 percent in the second quarter mainly due to a slowdown in fixed- income, currencies and commodities trading, JPMorgan Cazenove said in a note to clients on June 7. Royal Bank of Scotland Group Plc plans to cut 200 posts at its investment bank, a person with knowledge of the situation said this month, while Barclays Plc cut 100 jobs at its investment banking unit this month, a person briefed on the matter said.

Strategy Meeting

Credit Suisse has about 120 managing directors at its investment bank in Europe, the Middle East and Africa, one of the people said. About 20 director-level jobs are under review, the person said. Most of those affected by the cuts will leave the bank, while some will be relocated to other regions or positions, the people said. The cuts will be discussed at a Credit Suisse strategy meeting in London today, the people said.

A spokeswoman for Credit Suisse declined to comment today. Yesterday the bank said it was “realigning resources” and “adjusting capacity.”

The bank told employees it plans to cut jobs at its investment bank, three people with knowledge of the talks said yesterday. The investment bank employed 20,800 people at the end of March, up from 19,400 at the end of 2009.

Credit Suisse’s investment bank posted a 25 percent decline in first-quarter pretax profit from the year-earlier period as costs rose and the Swiss franc rose against the dollar, eroding revenue. The unit, which suffered smaller writedowns than larger Swiss competitor UBS AG after the 2008 financial crisis, has been trying to boost market share by expanding its sales force.

--Editors: Francis Harris, Edward Evans.

To contact the reporters on this story: Ambereen Choudhury in London at achoudhury@bloomberg.net; Liam Vaughan in London at lvaughan6@bloomberg.net Elena Logutenkova in Zurich at elogutenkova@bloomberg.net

To contact the editors responsible for this story: Frank Connelly at fconnelly@bloomberg.net; Edward Evans at eevans3@bloomberg.net


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