Bankers and banks finally pay the price of their past mistakes... in 2011...and beyond

The times have come when European and American banks are slashing jobs instead of expanding and growing. This will have impact in growth centres such as Singapore, Dubai etc where local banks will continue to flourish like in India, Brazil and China while 'international' banks will continue to decline both in scale and scope in the coming years......Lack of reserves in times of uncertainty can haunt all businesses including the banks themselves. Most of the Top 20 banks globally have been brought down in profits, assets and no. of employees, thanks to the unprecedented crisis. Most have been replaced by Chinese, Canadian and Australian banks in the Top 20.

1.

Credit Suisse announced 2,000 job cuts last week. But WSJ says to expect more job cuts in coming months.

http://blogs.wsj.com/source/2011/07/28/expect-more-job-cuts-at-credit-suisse/

The rise of Swiss Franc is hurting the Swiss banks since most of their business is from abroad and in USD. Plus, deals are slowing and Governments are putting pressure on taxation while the past mistakes of banks are catching up from Ireland, Iceland, Greece, Italy, Portugal etc.

2.

HSBC may cut over 10,000 jobs, according to news this week.

http://retailbanking.banking-business-review.com/news/hsbc-may-cut-10000-jobs-to-slash-costs-280711

This is in addition to sale of bulk of their business and thousands of lay offs that have happened in 2008 to 2010 period and 360 announced in Middle East in June 2011.

3.

UBS has announced 5,000 job cuts last week.

Interestingly, they have announced 3% lay offs in Asia Pacific as well.

http://uk.reuters.com/article/2009/04/14/uk-ubs-idUKTRE53D3YA20090414

4.

Lloyds Bank has announced 15,000 job cuts last month

http://www.ft.com/intl/cms/s/0/17166134-a2ea-11e0-a9a4-00144feabdc0.html#axzz1TTwSFrFg

There is news of sale of 660 branches of Lloyds to Mr Osmond a businessman from UK together with Virgin Group

5.

RBS from UK announced 200 cuts but laid off over 3,000 bankers last month

http://www.financialadvice.co.uk/news/12/ukeconomy/8565/employment-massacre-in-the-city-as-rbs-cuts-3000-adrift.html

6.

Goldman Sachs has announced 'official' job sits of 1,000 last week

http://www.bloomberg.com/news/2011-07-19/goldman-sachs-plans-job-cuts-as-debt-trading-misses-estimates.html

Plus....

7.

Cisco has announced 6,500 and upto 10,000 job cuts globally, last week.

http://www.bloomberg.com/news/2011-07-21/cisco-s-6-500-job-cuts-could-hurt-push-for-offshore-tax-holiday.html

 8.

RIM, from Canada whose stock is languishing in the 20's from upper USD 70's also announced cuts but they hired 1,500 since Feb 11 and are letting go, 2000 now.

http://www.bizjournals.com/dallas/blog/2011/07/rim-cuts-jobs-but-hired-1500-since.html

Impact on Emerging Markets

9.

The way the emerging markets like India will get slow down is due to lack of outsourcing from Europe and America, which can partly be blamed on inflation and rising salary costs besides patriotic sentiment to create local employment in Europe and USA.

For example, Santander bank has closed all contracts with India and brought most outsourcing jobs back to UK.

http://www.cio.in/news/santander-moves-call-center-jobs-india-uk-146152011

Meanwhile, after 2 years of work, Union Bank of California cancelled a USD 20m contract with Infosys from India, this week.

http://timesofindia.indiatimes.com/tech/news/software-services/US-bank-cancels-Infosys-deal/articleshow/9333220.cms?intenttarget=no