Wachovia plans to cut 500 jobs within its corporate and investment bank
Wachovia Corp. will slash its dividend and raise $7 billion in a share sale after reporting a surprising first-quarter loss on Monday of $393 million. Also, the bank said it plans to cut 500 jobs within its corporate and investment bank, an area that has been hit by the drying up of the issuing of complex securities. Since October, Wachovia has cut more than 260 jobs in corporate and investment banking, which had about 6,100 employees as of Dec. 31.
Any ideas what groups will be hit? Should first year analysts expect the worst?
They are going to kill off dead wait from all sectors. The retail divison is supporting the rest. That sector will also be cutting employees...just to much dead weight.
That 24 billion acquisition mortgage company out in Cali was/is the cancer.
And it is not 500 jobs..more like 10 to 12% of the entire company.
I'm not sure first year analyst should expect the worst. As many people have talked about numerous times before, usually analyst are the last to be let go becuase they are relatively cheap labor and they are the ones doing to grunt work. Then again these are some pretty bad times so I guess anything can happen
Lev Fin and Structured Products are going to be hit the hardest
Theoretically, Analysts are the cheapest and therefore it makes the least sense to let them go... but in reality, Analysts also have the greatest numbers in terms of employees at the bank, so if you're trying to please your shareholders it looks better to say, "We just fired 500 people!" (oh and btw 400 were Analysts) than to say, "We fired 50 people!" (but all of them were making > $1MM per year).
In the layoffs across the Street so far, a significant number of Analysts have been cut... in fact, I don't even know why I still have a job considering how many friends have been laid off.
In general LevFin/Structured Products will be hit hardest, as stevenbn said, but I don't think anyone is "safe."
dosk,
If you could estimate, how many of your friends do you think have been laid off?
Of all my friends who did banking right after graduating, I'd say around 1/3 left after their first years, either to go to PE/HF early or to leave finance altogether. Then about 1/3 have been laid off recently, e.g. since the market downturn in the summer last year.
Which leaves very few people of those I originally knew in banking. In fact it almost feels like I'm the only one left.
This shouldn't scare anyone - I think you'd find much the same situation of anyone who started 2 years ago. There's always incredible turnover in banking... when the market is bad, it's people getting fired and leaving the industry and when the market is good, it's people hopping to other firms/buyside.
Just the nature of the beast.
How many of the 6,100 jobs are banker positions (analyst/assoc/D/VP/MD) vs various support/administrative staff positions?
By definition Wachovia doesn't have banker positions... They are all douchebags.
^^ somebody is mad because even Wachovia wouldn't give him a job
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