It's turning out to be a bit of a bad news week over at Dresdner Kleinwort.
On Monday we reported that it looks like front office bods are to be advised and paid their bonuses weeks before support staff (that went down well), and now the firm is understood to be going through a pre-Christmas job cull. What's at issue, however, is whether the current job axings are part of an annual performance review, or a wider cost-cutting exercise.
Financial News reported Tuesday that unnamed 'sources' had said that the firm had originally targeted 'making 15 - 25% of its front office staff redundant' (which would mean several hundred facing the axes), and that there are claims that 'any suggestion that the redundancies were part of a performance review were ' ridiculous''.
Our sources say that that the cuts are part of a global initiative, and that 120 staff in London and 50 in New York are for the push. There will be other casualties in Asia and the rest of Europe, although any cuts in Germany will take place in the New Year after worker's council approvals have been obtained.
In truth, the underlying reasons for the latest Dresdner Kleinwort cull is probably a mixture of the normal performance-related pre-bonus cull undertaken by several firms this time of year (although this year's Dresdner Kleinwort review is understood to be somewhat more rigorous than that undertaken in previous years), and a desire to rein in costs further. The firm's relatively new CEO, Stefan Jentzsch, still has much to prove after a transitional year, and probably wants to clear the decks as much as possible to in order to put in a strong showing in 2007. He is understood, however, not just be to in cost-cutting mode, and is in the market to hire quality professionals into businesses the firm sees as key to its future.
Finally, Reuters reports that Royal Bank of Scotland has shut down its FX prop trading desk in London. This decision is said to affect 6 staff, who are seeking alternative employment within the firm.