Tags: job | cuts | Credit Suisse | fixed-income

Credit Suisse Creates New Fixed-Income Group After Bond Job Cuts

Friday, 15 Nov 2013 11:54 AM

Credit Suisse Group AG, the second biggest Swiss bank, is setting up a new division to combine its rates, foreign-exchange and commodities operations as it cuts more than 100 fixed-income jobs in London and New York.

The bank’s Global Head of Rates Jon Kinol in New York and Head of Global Foreign Exchange David Tait in London have been appointed to jointly run the newly-formed Global Macro Products group, Gael de Boissard, co-head of the investment bank, wrote in a message sent to employees. Adam Bradbery, a spokesman for the Zurich-based bank confirmed the content of the memo.

“Given the changes to the macro environment and the evolution of the financial and regulatory framework, we are combining our Rates, FX and Commodities franchises into a newly formed Global Macro Products group,” de Boissard wrote in the message that was obtained by Bloomberg News. It “allows us to create scale in our delivery of macro products, and therefore achieve capital and cost efficiency,” he said.

Credit Suisse plans to cut about 50 jobs in New York and 65 jobs in London within its fixed-income department, two people with knowledge of the matter said this month. Drew Benson, a spokesman in New York for Credit Suisse, declined to comment on the subject at the time.

The fixed-income business had a “challenging” third quarter as client activity slowed across the industry, Credit Suisse Chief Executive Officer Brady Dougan said in an interview with Bloomberg Television last month.

Profit Declines

Credit Suisse’s investment bank said last month that pretax profit fell 53 percent in the third quarter from a year earlier to 229 million francs ($250 million) as revenue from fixed-income sales and trading slid 42 percent to 833 million francs. Revenue from equities rose 8.3 percent to 1.07 billion francs.

The company said in its earnings report it was restructuring its rates business to help improve returns due to developments such as a heightened regulatory focus on leverage and the migration of market structure toward electronic trading.

Switzerland’s UBS AG and Credit Suisse may both have to shrink their fixed-income, currencies and commodities activities if the nation’s regulator imposes higher leverage ratios than currently planned, JPMorgan Chase & Co. analysts led by Kian Abouhossein in London wrote in a research note Nov. 4.

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Credit Suisse Group AG, the second biggest Swiss bank, is setting up a new division to combine its rates, foreign-exchange and commodities operations as it cuts more than 100 fixed-income jobs in London and New York.
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Friday, 15 Nov 2013 11:54 AM
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