Financial turmoil prompts City job jitters
Friday 11 September 1998
Talk last night centred on Merrill Lynch, which late on Wednesday shocked Wall Street with the admission that emerging market losses have all but wiped out profits since July.
Traders said that the statement from the company's chairman, David Komansky, accompanying a profits warning on Wednesday night that "selective cost reductions will have to be implemented" was a clear signal of cutbacks on the way. Sources said that the bonus pool had already been cut by 80 per cent.
Merrill has been among the most aggressive banks in building up its emerging market activities, much of which is now based in London.
Dealers say that they believe the City could see its biggest bout of bloodletting since 1994 when blue chip houses like Goldman Sachs were aggressively pruning back on headcount.
Since then banks have hired aggressively, especially in emerging markets. "This was an industry in growth phase. People are going to be stopping hiring short-term and cutting back, though not necessarily in the places you would expect."
Other banks which have suffered big emerging market hits recently, including Credit Suisse First Boston and Barclays Capital, have said that their operations are now under review.
City headhunters have been phoning staff in key positions in the hope of being able to exploit the widespread uncertainty.
"If you believe that we are not talking about a 20 per cent correction but a prolonged downturn, everyone will be having to make decisions," said one trader last night.
Merrill said last night: "We are constantly reviewing staffing levels in the light of market conditions."
Merrill said that it earned $102m so far this quarter, less than a fifth of what is made in the second quarter.
- 3 The enemy within: People who hear voices in their heads are being encouraged to talk back
- 4 British grandmother Lindsay Sandiford faces execution by firing squad in Indonesia
'We would evict Queen from Buckingham Palace and allocate her council house,' say Greens
French court convicts three over homophobic tweets, in case hailed as a 'significant victory' by LGBT rights campaigners
Greece elections: Syriza and EU on collision course after election win for left-wing party
British Muslim school children suffering a backlash of abuse following Paris attacks
Islamic history is full of free thinkers - but recent attempts to suppress critical thought are verging on the absurd
30,000 reasons why the rhetoric on immigrants claiming benefits can stop now
iJobs Money & Business
£30000 - £32000 per annum + benefits : Ashdown Group: A highly successful, int...
£18000 - £20000 per annum: Recruitment Genius: This rapidly expanding business...
£25 - 28k + Bonus: Guru Careers: An In-house / Internal Recruiter is needed to...
Negotiable: Recruitment Genius: A Tax Assistant is required to join a leading ...