Barclays cutting 3,000 as profit falls
LONDON - Barclays PLC, Britain’s second-largest bank by assets, said it’s eliminating about 3,000 jobs this year as second-quarter investment banking profit fell by more than a quarter.
The bank has already cut 1,400 of the positions this year, chief executive Robert Diamond, 60, told reporters after Barclays Capital reported a 27 percent decline in pretax profit to $2.31 billion in the three months to June 30.
The total reduction in employee numbers in 2011 will be of the “magnitude’’ of 3,000, Diamond said. The shares rose.
Bonus restrictions mean bank profits “take the hit when volumes come down, when previously it was the staff - it’s the law of unintended consequences’’ said Jane Coffey, head of UK Equities at Royal London Asset Management, which manages about $51 billion including Barclays stock.
European banks, including UBS AG, Credit Suisse Group AG, and HSBC Holdings PLC, have cut positions during the past week after positions reporting falls in second-quarter investment banking profit as the continent’s sovereign debt crisis hurts trading.
European banks have slashed 230,000 jobs since the start of the financial crisis in 2007, according to Bloomberg Industries.