Nomura Securities, the Japan-based investment bank, cut 400 of its staff globally last week, according to a source with knowledge of the matter.
The cuts were mostly in the U.K. with some hitting the bank’s New York regional headquarters, according to the source who spoke on the condition of anonymity.
The recent spate of layoffs, which have been hitting most Wall Street firms, did not come as a complete surprise at Nomura.
Back in September, Nomura was reportedly planning to axe around 5% of its European-based staff, or about 300, with plans to cut up to 400 globally, according to Reuters.
Our source tells us that some people at the bank’s U.S. headquarters, not surprisingly, worried that the layoffs would hit them. Last week, they did.
Until the bank reports third quarter earnings, more layoffs are a concern.
Now, Nomura’s executives are currently working on drafting up cost-cutting measures that would save the bank up $1 billion, the Wall Street Journal reported.
From the WSJ:
If Nomura cuts $1 billion, it would be more than 6% of the firm’s roughly $15 billion in revenue last year. Of Nomura’s 35,630 employees, 4,436 are in Europe. As of late last year, Nomura’s had 1,941 U.S. employees, up from 650 in September 2008.
However layoffs are less of a concern for some.
After Lehman Brothers collapsed in 2008, Nomura acquired the failed U.S. bank’s business operations around the world including Lehman’s equities division in the U.S.
Our source says even though people in the World Financial centre office are worried given the recent layoffs, the good news is Lehman is still a relatively new investment, so they have about another two years to prove it was a good investment.
The cost-cutting initiatives will likely affect the bank’s money-losing areas, according to the WSJ. What should be reassuring for those in the U.S. office is they are one of the profitable areas for Nomura, according to the WSJ.
The cost-cutting plan is expected to be revealed on November 1 when the firm reports its third-quarter earnings results. Analysts expect Nomura to post a quarterly loss, the Journal report said.
Nomura’s New York offices declined to comment. The bank’s U.K. offices could not immediately be reached for comment.