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Thursday, 6 June, 2002, 14:32 GMT 15:32 UK
Warburg axes investment bankers
City worker near Bank of England
Employment prospects look gloomy in the City
Investment bank UBS Warburg is to shed 200 London staff, in a signal of growing pessimism in the City.

UBS Warburg said it would cut workers in corporate finance, share and bond departments, as well as support operations.

The move, which follows cuts at rivals including Deutsche Bank, HSBC and WestLB, was interpreted in the City as a sign that UBS Warburg had lost faith in revival prospects.

"When I see these kinds of cuts my feeling is it probably tells you something about management's expectations regarding revenues," said Mark Hoge, European banking analyst at Bank of America.

"Investment banks' management are not really looking for an upturn in the second half any more."

A UBS Warburg spokeswoman said the cuts followed an annual review of the bank's costs.

"It reflects... changed market conditions which have necessitated some adjustment to the cost base," she said.

The bank cut 240 jobs a year ago after a similar review.

Calculated losses

While City banks shed staff wholesale during the late 1980s downturn, and amid the Asian Crisis a decade later, redundancies during the current slowdown have been made on a more calculated basis.

The speed of the market rebound from the Asian Crisis left many banks with staff shortages, and even having to rehire workers they had made redundant.

But the continued trickle of job losses over the last two years has amounted to a considerable total, observers believe, with the global securities industry estimated to have lost about 30,000 jobs in 2001.

The Financial Times estimated that British banks last year shed about 25,000 employees, mostly junior staff.

Deutsche Bank, which axed 2,900 jobs last year, cut a further 365 equities jobs in the US and Europe last month.

US-based Lehman Brothers has cut 60 of its 650 European investment banking staff.

See also:

14 May 02 | Business
15 Feb 02 | Business
30 Nov 01 | Business
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