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UBS cut 1900, Lehman 750. 131,700 jobs lost since July 2007

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UBS cut 1900, Lehman 750. 131,700 jobs lost since July 2007 [#permalink] New post 30 Sep 2008, 17:59
http://www.bloomberg.com/apps/news?pid= ... refer=home

Oct. 1 (Bloomberg) -- UBS AG, the European bank with the biggest losses from the credit crisis, may announce plans to eliminate about 1,900 jobs in its investment banking, equities, and fixed income units at its Oct. 2 shareholder meeting, two people with knowledge of the matter said.

Support staff jobs also will be eliminated, according to the people, who declined to be identified because they weren't authorized to discuss the cuts, which would represent about 10 percent of the total investment banking staff. Rohini Pragasam, a spokeswoman for UBS in New York, declined to comment.

UBS is scaling back its investment banking unit, which it plans to separate from wealth and asset management after mounting writedowns prompted rich clients to withdraw funds for the first time in almost eight years. The job cuts would be on top of 7,000 already announced by UBS, which has taken writedowns and credit losses of $44.2 billion since the credit crisis began last year.

``It is unquestionably the worst hiring climate I've seen in 30 years in the City for the European markets,'' said Shaun Springer, chief executive officer of Napier Scott Executive Search Ltd. in London.

Lehman Brothers Holdings Inc., the securities firm that filed for bankruptcy two weeks ago, yesterday eliminated 750 jobs in its European fixed income and personal investment management units after talks to find a buyer failed. Nomura Holdings Inc., Japan's biggest securities firm, agreed to buy Lehman's European investment banking and equities units in Europe along with its Asian-Pacific unit. London-based Barclays Plc purchased Lehman's U.S. investment banking unit for $250 million.

The Lehman and UBS cuts would bring to more than 131,700 the number of jobs eliminated at banks worldwide since July 2007.

Lehman Job Cuts

European governments have come to the rescue of five banks this week as the worst financial crisis since the Great Depression spreads beyond the U.S. Belgium, the Netherlands and Luxembourg agreed to inject 11.2 billion euros ($15.8 billion) into Fortis for minority stakes, while Belgium and France led a 6.4 billion- euro bailout of Dexia SA. Bradford & Bingley Plc was seized by the U.K. government, Iceland's Glitnir Bank hf was bailed out by the country's Financial Supervisory Authority and Germany's Hypo Real Estate Holding AG received a government loan guarantee.

In the U.S., Congress plans to vote again this week on a $700 billion financial-rescue package that would enable the Treasury secretary to buy assets from banks after government efforts to prop up companies including American International Group Inc. and Fannie Mae and Freddie Mac failed to restore market confidence. The U.S. House of Representatives voted against the plan Sept. 29.

UBS may report a fifth straight quarterly writedown and more withdrawals by wealthy clients as the credit crisis hits Europe in full force. Markdowns at UBS will probably amount to 3 billion Swiss francs ($2.7 billion), according to the median estimate of five analysts surveyed by Bloomberg. Writedowns, mainly on assets related to subprime mortgages, have already forced the bank to raise almost $28 billion in capital.

UBS's investment bank, which comprises fixed income, equities and investment banking, employed 19,475 people at the end of June, a 12 percent decline from 22,137 a year earlier.
UBS cut 1900, Lehman 750. 131,700 jobs lost since July 2007   [#permalink] 30 Sep 2008, 17:59
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UBS cut 1900, Lehman 750. 131,700 jobs lost since July 2007

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