Job losses at Barclays and Bank of America
A survey by the Confederation of British Industry (CBI) this week revealed that financial services companies are suffering record falls in profits.
As a result, the CBI said job losses in the financial sector will rise sharply during the first quarter of 2009.
The prediction has so far rang true after British banking giant Barclays is set to shed over 2,000 jobs worldwide (a 7% reduction in its workforce) in its investment banking and wealth management businesses.
According to reports, 1,300 jobs are to be axed at investment arm Barclays Capital, while 500 positions will go at Barclays Wealth. A further 370 jobs will be axed at Barclays Global Investors.
Just last week, Barclays announced it was to axe 410 jobs in its IT department. The bank said a review will see around 158 permanent staff and 250 contractor positions go, principally in Cheshire and in London.
Shares in Barclays closed down 10% at 165.90p.
In addition, it was announced today that Merrill Lynch and Bank of America are preparing to axe almost 2,000 staff in London.
Merrill Lynch agreed to an all-share bailout by Bank of America just days after the collapse of Lehman Brothers. The deal was finalised on January 1.
Merrill Lynch staff have been informed that the group is looking to reduce 30% of the combined workforce in the capital.
The job losses add to the 28,000 jobs already lost in the City last year, according to figures from the Centre for Economic and Business Research.