Cut jobs and slash pay – that’s the new mantra of big banks. And it’s working.
The benefits associated with cost-cutting were on full display on Thursday with the release of fourth-quarter earnings reports from Deutsche Bank and Nomura, firms that appear poised to continue slashing operating costs.
Nomura’s $1 billion cost-cutting plan at its wholesale business helped the Japanese bank book a $221 million net profit for the last three months of 2012, more than seven times the earnings reported in the previous quarter. The firm was profitable in each of its three key regions – Europe, the Americas and Asia outside Japan – for the first time in more than three years. Nomura plans to keep making cuts through 2014.
Deutsche Bank, meanwhile, posted a fourth-quarter net loss of $2.94 billion. But that number is misleading; much of the loss can be attributed to charges related to legal fees and the reorganization of its businesses. The underlying figures are positive: The German bank reported a 14% increase in revenue over the fourth quarter of 2011 despite acknowledging that it cut 1,700 jobs late last year. Deutsche Bank is doing more with less.
Now, the German bank is considering moving 8,000+ employees in New York, London, Hong Kong and Singapore to less expensive locales, Anshu Jain, co-chief executive of Deutsche Bank, announced on an analyst call. Today’s New York may be tomorrow’s Jacksonville, Florida. Birmingham may soon replace London.
How many people will buy coffins in a country with a population of five million people? What’s Microsoft’s worst product? These are just a couple of the questions M.B.A. graduates and prospective interns from New York University’s Leonard N. Stern School of Business were asked by consulting companies in recent months.
Finance hiring isn’t exactly booming in any locale, but the job market is improving incrementally in Canada.
Knight Capital is considering selling its underperforming bond-trading and reverse-mortgage units. The firm has also cut roughly 40 jobs this week.
Russell Wasendorf Sr., the 64-year-old founder of Peregrine Financial Group who pled guilty last year of bilking $215 million from investors, was sentenced to 50 years in prison on Thursday.
Big banks are hiring mortgage staff in droves, but that may soon slow if an alarming trend continues. Lenders are making much less than they used to on loans, and now applications are down.
As the year progresses and healthy resolutions start to slip, academics and cardiologists are warning bankers to watch for heart conditions.
Morgan Stanley Chief Executive Officer James Gorman and other top execs are getting salary raises. The move is designed to offset bonus reductions and bring their overall compensation to more competitive levels.
Buzz Around the Office
What is the game of “tag” like when you’re 40 and have wives and bank accounts? Just as juvenile, but a lot more fun.
List of the Day: Networking
If you play your cards right, your network can be your biggest ally when it comes to getting a new job. Here’s how to pull it off.
- Let people know what you do.
- Grow your social media profile and start sharing with people in your field.
- Offer to lend a hand using your work skills.