The initial wave of 2700 global redundancies in December included 540 job cuts in Switzerland and as many as 200 in London.
Credit Suisse employs more than 5000 people in London and 16,000 in Switzerland.
Jobs most at risk
Consultations over the next round of redundancies started before Christmas, with more than 10 per cent of investment banking jobs in Europe under discussion, according to people with knowledge of the talks. A final decision is expected next month.
The lender employs around 17,000 investment bankers globally, with its main centres in New York and London.
In some of Credit Suisse’s smaller European outposts, as many as a third of jobs are threatened as the bank restructures its operations in the hope of eliminating overlapping roles and front-office positions.
Many investment bankers that survive job cuts in Credit Suisse’s New York office, its main hub outside of Europe, have the prospect of joining the planned First Boston spin-off, which will be led by former Credit Suisse director Michael Klein.
But there is less certainty about investment banking roles in Europe, given First Boston will be centred on the US market.
“It is difficult to know where we will fit in, though it’s clear European activities will be slimmed down over time,” said one Europe-based banker. “We are in wait-and-see mode.”
Another option to manage costs is cutting the bonus pool, which was reduced by a third last year.
Prioritising wealth
Few of Credit Suisse’s investment bankers expect much in the way of a bonus this year, given the annual loss the bank has signalled it will report next month.
But senior managers are eager to offer incentives to wealth managers who have strong personal connections with clients to prevent them defecting to rivals as well as staff working on critical projects.
“I expect bonuses in my team to be close to zero,” said one Credit Suisse dealmaker.
“But for the top guys in the private bank, they will get a lot of attention and they will try to retain as many of them as they can.”
In just three weeks in October last year, wealth management clients withdrew 63.5 billion Swiss Francs ($98 billion) from Credit Suisse, the equivalent of 10 per cent of assets.
By comparison, UBS suffered 10 per cent of outflows over an entire year during the global financial crisis.
Credit Suisse chair Axel Lehmann told the Financial Times last month that withdrawals had flattened and clients were returning to the bank.
Credit Suisse declined to comment on the prospect of further job cuts or its bonus policy.
Financial Times
