- Citigroup is slashing jobs amid a slump in global banking revenue, Bloomberg reported.
- It includes at least 100 jobs in the equities unit — at least 10% of the division.
- Banks have watched revenues slump due to Trump’s trade war and the Fed’s changing stance on a rate cut.
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Citigroup is to cut hundreds of jobs in 2019, including 10% of its equities unit as it becomes the next bank to succumb to the global slump in banking revenues, according to Bloomberg.
The job cut comes as a sign that the slump may be more permanent that previously thought, going beyond trade-war tension and changes in policy for the Federal Reserve.
"This won’t be the last trading-related job cuts story," Jeff Harte, an analyst at Sandler O’Neill, told Bloomberg. "The rest of Wall Street is thinking the same way."
Trading desks have been weighed down recently, aside from market swings.
"Hedge funds, typically banks’ most active clients, have suffered outflows while struggling to outperform lower-cost funds. New rules are limiting lenders’ ability and willingness to make principal bets with their own money. And technological advancements are narrowing spreads in many corners of the market."
Deutsche Bank earlier this month announced a much larger job cut of 18,000 jobs, closing down its global equities branch of the business in the process.
Bloomberg also noted that trading revenue in the five biggest US banks dropped 8% in the second quarter, following a 14% slide on the previous quarter. So far it looks like the first half of 2019 will be the worst in more than a decade. Citigroup’s combined revenue from equities and fixed-income fell trading 5%.
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