Bloomberg News

Macquarie Said to Cut 10% of Asia Investment Banking Jobs

February 14, 2012

(Updates with comment from analyst in fourth paragraph.)

Feb. 14 (Bloomberg) -- Macquarie Group Ltd., Australia’s biggest investment bank, cut about 10 percent of its investment banking workforce in Asia last week, two people with knowledge of the departures said.

Koichiro Yano, a financial institutions group banker in Tokyo, is among about 20 employees in Asia outside of Australia leaving Macquarie, the people said, asking not to be identified because the departures aren’t public. Macquarie, which is mainly cutting vice presidents and some junior positions, will maintain an investment banking presence in 14 countries in Asia, one of the people said.

Macquarie said on Feb. 7 that slumping advisory fees will contribute to a 25 percent drop in profit for in the year ending March 31. Bank of America Corp. and Nomura Holdings Inc. have also fired investment bankers in Asia as Europe’s lingering credit crisis made companies reluctant to spend on acquisitions and unable to sell shares on stock markets.

“Macquarie have flagged they’re looking to rationalize costs and capital across the group,” said Brian Johnson, an analyst at CLSA Asia-Pacific Markets in Sydney with a “buy” rating on the stock. “We’re seeing Macquarie taking out a lot of businesses they didn’t feel contributed to profit and they’re rationalizing them away.”

Fiona McDonald, a Hong Kong-based spokeswoman at Macquarie, declined to comment. Yano couldn’t be reached to comment.

Income Decline

Brook Vinicchayakul, who helped run the Sydney-based bank’s investment banking business in Thailand, left after the company formed an alliance with Kasikornbank Pcl, the people said. Macquarie is seeking to tap Kasikornbank’s local team of 30 bankers to win more equity capital markets business and mergers and acquisitions deals, one of the people said.

A person who answered the phone at Vinicchayakul’s office said he is no longer with the firm.

Operating income at Macquarie Capital, the unit that includes mergers advisory and equity and dept capital markets, may drop 35 percent in the six months through March 31 from a year earlier, Macquarie said last week. The division has been “severely impacted by macroeconomic conditions,” according to the statement.

Royal Bank of Scotland Group Plc is seeking buyers for most of its advisory unit, and may close the business if a sale fails. RBS said in January it will cut about 4,800 jobs, including 3,500 at its investment bank over the next three years, as the Edinburgh-based lender tries to sell its unprofitable cash equities and merger-advisory operations.

--With reporting by Jacob Greber in Sydney.

--With assistance from Jacob Greber in Sydney. Editors: Mohammed Hadi, Nathaniel Espino

To contact the reporter on this story: Cathy Chan in Hong Kong at kchan14@bloomberg.net

To contact the editor responsible for this story: Philip Lagerkranser at lagerkranser@bloomberg.net


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