U.K. Financial Services May Have Cut 9,000 Jobs, CBI Survey Says

U.K. Financial Services May Have Cut 9,000 Jobs, CBI Survey Says
City workers walk past Tower 42, center, in London. Photographer: Simon Dawson/Bloomberg

The U.K. financial-services industry lost an estimated 9,000 jobs in the third quarter as revenue and profit declined, according to a survey by Britain’s biggest business lobby group.

Banks, insurers, asset managers and other financial firms may eliminate a further 3,000 employees in the final three months of the year, the Confederation of British Industry said in a report today. At the end of June, the industry employed 1.14 million people in Britain, the CBI says.

“The U.K.’s lackluster economic performance is hanging heavily over the industry,” said the CBI. “Faced with such weak demand, the industry is continuing to take steps to reduce its cost base.”

Banks, which face increased regulation after the 2008 financial crisis, are cutting jobs as Europe’s sovereign debt crisis crimps income from trading stocks and bonds and the pace of takeovers slows. Global mergers and acquisitions slumped in the third quarter to a level not seen since the same period of 2009, according to data compiled by Bloomberg. Britain’s gross domestic product fell 0.4 percent in the second quarter, the Office for National Statistics said last week.

The survey said 19 percent more companies reported a drop in sales than recorded a rise. The CBI and PricewaterhouseCoopers LLP surveyed 104 banks, insurers, customer-owned lenders, investment managers and securities firms from Aug. 20 to Sept. 6.

Lowest Vacancies

Separately, a study published today by recruitment firm Morgan McKinley said vacancies at London’s financial-services companies fell to the lowest this year in September.

Openings in the City, London’s main financial district, and elsewhere in the British capital declined 43 percent in to 2,205 from 3,843 in the year-earlier period, Morgan McKinley said.

“From talking to various financial institutions across London, there is very little consistency in hiring plans for both the immediate and longer term future,” Hakan Enver, operations director at Morgan McKinley financial services, said in its statement.

Nomura Holdings Inc. is eliminating about 100 investment banking jobs in Europe as Japan’s biggest brokerage unwinds a four-year-old international expansion, three people with knowledge of the plans said on Sept 21. UBS AG, Switzerland’s biggest bank, plans to cut about 80 to 90 jobs in its European investment-banking division, two people with knowledge of the matter also said last month. Most of those cuts will be in London, the people added.

“It has proved to be an unexpectedly bad summer for bankers,” said Mark Cameron, chief operating officer at Astbury Marsden in a separate statement today. A number of banks “continue to scale down their investment banking operations,” he said.

Astbury Marsden said the number of new City jobs fell to 2,490 in September from 2,925 in August.

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