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Goldman Sachs is going to axe up to 30% of its investment bankers in Asia. Sources familiar with the bank’s plans, told the Financial Times that the bulk of the cuts will be in Hong Kong and Singapore.
The investment bank currently hires 300 investment bankers in Asia, so the number of jobs can be as high as 100.
Bankers in Australasia and Japan are unaffected by this round of cuts, and the number of jobs that will be affected on mainland China will be relatively few, the source said. Goldman employs just over 100 bankers in China, it was one of the first foreign investment banks to operate there.
The job cuts were first reported by Reuters.
The investment banking revenue of Goldman Sachs was down by 11% to $1.79 billion in the second quarter, the slow down has put a lot of pressure on the bank to cut budgets.
Goldman said in July it had embarked on a cost-cutting plan that would save US$700 million a year in response to a “challenging backdrop” for revenue.
In the same month, it asked 2,000 employees at Goldman Sachs Asset Management (GSAM) to cut back on costs—including travel that doesn’t involve meeting a client or getting new business
Last year, Goldman reduced the number of its investment bankers in Singapore to about 35 from 50, according to Reuters.
In an interview with the South China Morning Post, Jerry Chang, managing director of headhunter Baron & Co. said it has been a trend for Western investment banks to fire staff in Hong Kong, because they can no longer make as much money as they used to from their IPO deals.
“More mainland firms seeking public listing in Hong Kong are hiring mainland investment banks, therefore their share of the pie is becoming smaller,” he said.