Banks announce thousands more job losses as City fights to cut costs

TWO investment banks announced further major job losses yesterday – as a top City headhunter revealed it was also making hundreds of redundancies as recession sweeps the financial sector.

Japanese investment banking powerhouse Normura said it was to axe about 1,000 jobs in London over the next few months.

Swiss bank Credit Suisse disclosed it was laying off 5,300 workers worldwide, which includes 650 investment bankers based in London's Canary Wharf that the bank had already announced this week.

Credit Suisse had previously cut 1,800 other jobs this year. A spokesman said there was no breakdown of the redundancies, but confirmed: "Two thirds of them are in investment banking and support services."

Michael Page, the recruitment consultancy, issued a profit warning yesterday and said it was also wielding the jobs axe.

Full-year earnings will be at the bottom end of forecasts, at £136 million, after a loss of confidence spread to "every sector and geographic market", the firm said.

Page added that its costs and staff levels were being "managed down", which will see 400 jobs go from its 5,500 payroll.

Meanwhile, industry sources said Commerzbank of Germany planned to shrink its UK mergers and acquisitions business to a "small presence" when it takes control of rival Dresdner Kleinwort. Commerzbank is paying insurer Allianz just over 5 billion (£4.3bn) for Dresdner Bank, which includes the Dresdner Kleinwort investment banking business.

A source said: "The (M&A] division will be scaled back significantly but (Commerzbank] will retain a small presence in London."

In September Commerzbank outlined its plans to cut 9,000 jobs in the wake of the Dresdner Bank deal. As part of those cuts, 1,200 will be laid off in London. Commerzbank declined to comment.

The latest bloodletting brings to 150,000 the number of redundancies in the worldwide financial sector since September when Lehman Brothers filed for bankruptcy. Nomura said it was making the cut from its 4,500 workforce in London to cut costs because of tough markets.

Most of the job losses will be achieved by next March, the bank said.

Nomura, which was the first foreign bank listed on the London Stock Exchange in 1986, recently bought the European equities and investment banking businesses from failed US bank Lehman Brothers. A Nomura spokesman said: "Clearly we had some overlap with existing operations. And given the current market conditions we are reviewing the business to ensure that we have the right costbase."

Nomura's main office is near St Paul's cathedral, while the Lehman operations are in Bank Street, Canary Wharf. The spokesman said a real estate committee was reviewing where the new operations would eventually be based.

Nomura currently employs 1,500 at its London headquarters, while it took on another 3,000 workers when it bought Lehman's European operations.