Barclays PLC is cutting just under 10 per cent of the staff in its European equities operation as part of the overhaul of its investment bank, scaling back an area it had until recently been building up, people familiar with the matter said.
Between 40 and 50 staff are set to be axed from the business after a slowdown in equities trading across the industry, the people said. Barclays employs just over 500 people in its equities division in Europe, Middle East and Africa.
"We can confirm that we have begun a consultation process within our EMEA equities franchise," a spokesman for Barclays said. He said the bank would continue to hire selectively across parts of the investment bank that are growing.
Barclays started consulting with staff two weeks ago, and some departures started this week, the sources said.
Banks are stepping up efforts to cut costs as it becomes clear that a slump in trading in the last 18 months is continuing as the euro zone crisis drags on, leaving banks overstaffed and unprofitable in many areas.
Third-quarter results from European investment banks are expected to show equities revenues dropped 8 per cent from the second quarter, in contrast to a 3 per cent rise in fixed income, currencies and commodities and a 7 per cent rise in advisory income, analysts at Credit Suisse estimate.
Several firms are cutting back in equities in London, including Nomura Securities Co. Ltd., Royal Bank of Scotland PLC and Deutsche Bank AG.
Barclays chief executive Antony Jenkins, who took over in July after previous boss Bob Diamond stepped down following the Libor interest rate rigging scandal, is reviewing all areas and is expected to pare back parts of the investment bank.
Earlier this month Barclays said the investment bank would merge its trading and distribution teams across fixed income, commodities and currencies (FICC) and equities into a new Markets business, led by former FICC boss Eric Bommensath.