KCG Europe, the firm that emerged from the tie-up between Knight Capital and high frequency trader Getco last year, has seen through on promises to invest in people to an extent throughout 2014.
It brought in some big names from UBS during the summer including Phil Allison, most recently European head of equities and global head of cash equities, to lead its European business. It also hired John DiBacco, the former head of UBS’s Delta 1 trading division, in February who in turn has recruited some senior traders from Citadel, MF Global and ING over the past few months.
However, as accounts for 2013 filed this week indicate, this is from a low base at the start of 2014. During the course of last year, KCG Europe cut 31% of its employees in dealing and broking roles, to take the total to 75. The company also started 2014 with 55 staff registered with the Financial Conduct Authority, compared to 52 now.
These cutbacks are not just down to the merger, but also a need to cut costs in the wake of continuing losses. Last year, KCG Europe posted losses of £12.9m, a fourfold increase on the £4.2m it lost in 2012.
The firm admitted it was a “disappointing financial performance for the company and GETCO Europe” and that it would consider “opportunities for long term strategic growth through investment in technology, people and client offerings”.
KCG spent £33.8m on salaries and wages throughout 2013, or an average payment of £266.1k including its 52 admin staff, compared to a mean payout of £302.4k in 2012.
Its four directors, meanwhile, shared a pot of £1.9m compared to £3.8m in the previous 12 months. Throughout the year, KCG Europe also spent £1.6m on severance costs.
FCA filings suggest some senior employees have departed in recent months including Kee-Meng Tan, its managing director, strategy and product development, and Matt McLean, head of wholesale brokerage international, who are no longer listed.