It’s not a good time to be a very expensive 40-something banker. Nor is it, frankly, a good time to be a moderately expensive banker aged 35+. McKinsey & Co says banks in developed markets could be at risk of losing another 25% of their profits in the next three years, and banks are reacting accordingly. They are cutting costs – at the top, or very near it.
Reuters reports that Morgan Stanley is relieving itself of managing directors in investment banking. Headhunters say the U.S. bank has also cut executive directors and VPs in fixed income. And HSBC has made senior cuts in equities sales and trading.
HSBC’s cuts are said include Colin Robb, a director of EMEA sales trading who joined the bank in November 2015, and James Holloway, a director of sales trading who joined from Goldman Sachs in 2009. Robb had 25 years’ experience in banking, Holloway 16. The bank is also understood to have let go of Ross Tobias, an equity trader with 18 years’ experience whom it hired from Citi in 2015, along with Daren Legg, another experienced equities trader.
“These are all guys from their late 30s to late-40s,” says one equities headhunter.
Meanwhile, the equities cuts at Morgan Stanley which were reported earlier this week are said by headhunters to have fallen mostly upon director-level staff in London. Despite saying its fixed income job cuts were over, the U.S. bank has also let go of two senior salespeople: Camille Khalaf and Robert Newman. Colleagues confirmed the exits. Khalaf was an executive director in hedge fund sales and joined from Deutsche in October 2015. Newman was a VP in rates sales and had worked for Morgan Stanley since joining as an analyst in 2010.
Headhunters said the cuts at all banks are unlikely to be over. “I had a lot of worried calls over Christmas,” said one. “- Particularly from people in areas like leveraged finance, financial institutions group investment banking, and industrials IBD.”
Photo credit: Bonfire by Mark Berthelemy is licensed under CC BY 2.0.