Goldman job cuts begin with investment banking, global markets hit hard – source

  • It spells massive, costly losses for the Wall Street giant
  • For all the main parts that are expected around the world
  • Restructuring at the Asian wealth unit begins with layoffs on Wednesday

LONDON/HONG KONG/NEW YORK, Jan 11 (Reuters) – Goldman Sachs ( GS.N ) began laying off staff on Wednesday amid a massive cost-cutting drive, with around a third of those affected from the global markets and investment bank. . division, said a source familiar with the matter.

A source told Reuters: The long-awaited actions at the Wall Street titan, which are expected to represent the biggest contraction in capital since the financial crisis, could affect most of the bank’s main divisions, with Its investment banking arm is facing the deepest decline. this month.

More than 3,000 employees will be let go, the unnamed source said on Jan. 9. A separate source confirmed on Wednesday that the cuts had begun.

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The layoffs began Wednesday in Asia, where Goldman completed the divestment of its private wealth management business and laid off 16 private banking employees across its offices in Hong Kong, Singapore and China, a source familiar with the matter said.

About eight employees were also laid off in Goldman’s research division in Hong Kong, the source added, with layoffs continuing in the investment bank and other divisions.

At Goldman’s central London headquarters, the rain reduced the likelihood of overcrowding for staff. Many security personnel were actively guarding the entrance to the building, but few people were going in or out. A look at the bank’s recreation area just outside its lobby showed several employees deep in conversation but few signs of drama. The office’s local wine bars and restaurants also lacked afternoon trade, unlike previous mass layoffs when unhappy employees often gathered to console each other and plan their next career moves.

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In New York, employees were seen streaming through the headquarters during the morning rush hour.

The Financial Times reported on Wednesday that Goldman’s increase plans will be followed by a broader spending review on travel and corporate spending, as the US bank weighs the costs of a major slowdown in corporate transactions and a collapse in capital markets activity since the war in Ukraine. .

Goldman Sachs declined to comment.

Goldman had 49,100 employees at the end of the third quarter, after adding a significant number of employees during the coronavirus pandemic.

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The company is also cutting its annual bonus payments this year to reflect depressed market conditions, with payouts expected to fall by as much as 40%.

Global investment banking fees almost halved in 2022, to $77 billion earned by banks, down from $132.3 billion a year earlier, Dealogic data showed.

Banks made $517 billion worth of capital markets (ECM) transactions by the end of December 2022, the lowest level since the early 2000s and a 66% drop from the 2021 bond, according to Dealogic data.

Reporting by Sinead Cruise and Iain Withers in London, Selena Li in Hong Kong, Scott Murdoch in Sydney and Saeed Azhar in New York; Editing by Megan Davies, Elaine Hardcastle, Jane Merriman and Bernadette Baum

Our Standards: The Thomson Reuters Trust Principles.


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