Investec, SA investment bank and asset manager, revealed today that it “plans to cut 70 jobs” at its Australian business, reports Fin24
. CEO Stephen Kosseff delivered this bad news just after release of the trading update.
The bank hasn’t revealed any more details about what the job cuts would be, adds Fin24
In the trading update, Investec warned the market that its earnings for its first half to September could be down as much as 10%, reports IOL
. This is partly due to the “struggling Australia unit”.
But on a more positive note, impairments look like they will be down
Earnings are also under pressure due to a “drop in lending and assets under management,” says Fin24
. But Investec added that it expects impairment charges “to be 25% lower than the previous year”.
This is a stark turnaround in Australia from last year, where the bank saw 11% of its revenue come from this business, adds IOL
. The job cuts would happen along with restructuring of the business to “focus on private banking, corporate advisory and property funds”.
The restructuring will see Investec scale back from “securities, equity capital markets and structured finance products,” notes BDLive
Investec publishes its results in pounds as it also has a listing in London, says IOL
. In addition, the bank saw a drop in lending of 6% for the “five months to end August”.
The market didn’t like the news. The share plunged initially, but managed to scrape back some of the losses, closing down 3.05%.
We will just have to wait for the published results to see what’s happened over the past six months.