More job cuts for European banks?

13 September 2011

More job cuts for European banks?
A number of banks across Europe could carry out significant job cuts or limit bonuses due to the fixed nature of investment banker salaries throughout the continent.

Bloomberg reports lenders might resort to making staff redundant as they attempt to maintain contractually obliged compensation levels for certain workers.

The news agency noted this requirement - which has arisen after institutes raised the base rate salaries of investment bankers, some by 100 per cent - comes at a time of increasing uncertainty surrounding the stability of the financial markets.

Such decisions cannot be reversed - even if the problems facing the sector continue to mount - and Jason Butwick, an employment attorney at law firm Dechert LLP, said: "The absolute last thing banks will want to do is cut current salaries unless they have an explicit contractual right to do so."

Job cut announcements at European banks including UBS and Barclays - which operates in more than 50 countries - have already surpassed 70,000 since the middle of 2011.

By Tony Aynsley
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