Nomura Cuts Up to 30% of Europe Investment Bank Jobs
Nomura is making wide-ranging cuts in its European investment banking division on Thursday, according to sources, with up to 30 percent of jobs likely to go.
The cuts were confirmed by at least three sources, who spoke to CNBC on condition of anonymity.
“Today is D-day, there is a crazy atmosphere, everybody knows it is going to be big,” one source told CNBC.
Nomura declined to comment on the job losses.
The cutsinclude 30 percent of the industry team and the bank is closing its Swiss coverage, according to a source inside the firm.
Another source at the bank said the cuts are part of a move announced earlier this month to slash costs by $1 billion, mainly in its equities and investment banking units at its overseas operations.
Operations in Europe, the Middle East, and Africa will account for 45 percent of cost savings, the bank said, while units in the Americas will see costs cut of 21 percent, Asia-outside Japan will see cuts of 18 percent and Japanese operations will see cuts of 16 percent.
The firm has been struggling to achieve top-tier global investment bank status since it bought the European and Asian operations of Lehman Brothers in 2008.
Earlier this year, the firm reported net profit in the April-to-June quarter of 1.89 billon yen ($24.19 million), an 89.4 percent drop from a year earlier. That was despite a 12 percent jump in revenue.
“Banks are increasingly seeing that they have to deleverage and have to exit certain businesses as a whole as a results of this. There’s no longer going to be the excuse that ‘we made a lot of money at a certain point in the cycle,’ ” Edmund Shing, head of European equity strategy at Barclays Capital, told CNBC on Thursday.
Nomura is just one of several large banks taking an axe to costs in an effort to strengthen itself against a slackening global economy and more regulation. Bank of America announced plans to cut 16,000 jobs by year end as it speeds up a company-wide cost-cutting initiative amid declining revenues, according to The Wall Street Journal. Deutsche Bank announced last week it aims for 3.6 billion pounds ($5.8 billion) in annual savings by 2015 to survive in a less profitable investment banking world.
—By CNBC’s Bianca Schlotterbeck and Liza Jansen; Catherine Boyle contributed to this report