Here Is The City can exclusively reveal that up to 15% of the combined ABN Amro / Royal Bank of Scotland Global Banking & Markets workforce of some 20,000 staff are likely to lose their jobs as the bank right-sizes headcount to reflect current difficult market conditions.
John Hourican, the newly-appointed CEO of the bank's Global Banking & Markets Division, is understood to have indicated to insiders that up to 3,000 staff will go in the next round of lay-offs, which will start in the comings weeks.
The cuts will be made across all business lines in front, middle and back office, although the unit's credit markets origination business will be particularly affected (leveraged and structured finance, structured real estate capital, loan markets and syndication). Other staff likely to be laid-off work in credit trading, structured credit and on the exotics desks.
Although Stephen Hester, the bank's newly-appointed CEO, has said that he wants RBS to retain a global wholesale banking footprint, the Global Banking & Markets unit is likely to focus on less capital-intensive and less riskier business activities going forward. Hester is also known to want to reduce the bank's reliance on the wholesale markets for funding.
A spokesperson for Royal Bank of Scotland said: 'as you would expect, the bank is constantly reviewing headcount in the light of market conditions and will take the appropriate action as necessary'.
And the bad news continues, with Morgan Stanley confirming Wednesday that it is to lay-off a further 2,000 staff - 10% in its institutional securities unit and 9% in asset management. The cuts in institutional securities will likely come in prime brokerage, prop trading, principal investments and commercial real estate origination. The investment banking unit will also see job losses.
Although cuts will be made around the globe, The Wall Street Journal reports that Stephen Roach, the chairman of Morgan Stanley Asia, told reporters Wednesday that 'the reduction we implement in Asia will be a good deal less than our global workforce reduction, given our belief this region is a huge source of growth for the world and Morgan Stanley'.
Finally, the Morgan McKinley London Employment Monitor Survey has revealed a 48% fall in new job vacancies in October compared to the same month one year ago.
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