WestLB Mulls Cutting New York Staff By Half
WestLB is considering halving the number of staff in its New York office to roughly 250 as part of an effort to bring costs more into line with revenues. It also plans to focus activities on higher-margin investment banking businesses.
The German bank, which returned to profit last year for the first time since it restructured in 2002, is considering cutting half of its 500 New York staff in a plan that would see the U.S. office concentrate on "value-added cash businesses rather than flow businesses", according to sources at the bank.
They added that WestLB, which will make a decision on the cuts by the end of this year, is likely to focus on investment banking areas including asset-backed debt, project finance and structured finance.
The bank declined to comment on its U.S. plans, although a source said shareholders are of the view that staff compensation, particularly bonuses, should not be huge in product areas that do not generate sufficient revenues.
WestLB said in March that strong performances in project finance and securitisation helped drive profits in its investment banking unit to $508 million before tax.