Friday, May 6, 2016
Goldman Sachs is firing traders again
Goldman Sachs on Thursday made job cuts in its securities business, according to people familiar with the matter.
The cuts bring the headcount reduction in the fixed-income, currencies and commodities (FICC) business to around 10%, the people said.
The news was first reported by The Wall Street Journal.
Goldman Sachs cut staff in a round of redundancies earlier in the year.
The bank had a lousy first quarter, posting a 37% decline in trading revenue versus the same quarter a year earlier. FICC revenues fell 47%.
Harvey Schwartz, CFO at Goldman Sachs, was asked if there might be more job cuts on the bank's first-quarter earnings call.He said (emphasis added):
In terms of other cost initiatives, I know there's been a lot of stuff in the press. I guess I would really summarize it as follows. I would just say we're shareholders and we're doing things that you would expect shareholders to do.
The FICC business in particular has seen a lot of change. It was announced late last month that the cohead of global fixed-income, currency, and commodities sales, Dalinc Ariburnu, would leave the bank. The other cohead is Tom Cornacchia.
In March, Cornacchia, described a cultural shift wrought with "friction" and "awkwardness"inside the global FICC business.
The Goldman Sachs news extends a miserable week for investment banks. Business Insider reported on Wednesday that Credit Suisse had fired about 130 people in the global-markets business in London.