Are Deutsche Bank redundancies sign of things to come in Saudi?

Deutsche Bank has taken the relatively unprecedented step of trimming its team in Saudi Arabia, according to reports. Does this mean there could be more moves like this on the cards?

The 50-strong team in Saudi has been pared back in recent months, says Financial News, citing a bank insider. Redundancies are being an increasingly common phenomenon in the GCC, especially at international investment banks, but most have so far been restricted to Dubai.

Could this mean that Deutsche's move is a sign of things to come? In the last year, UBS, Nomura, Credit Suisse and Calyon have all gained Saudi licences, expecting a flurry of new business which has yet to materialise. And until recently, investment banking recruitment was relatively healthy in the kingdom.

Ian Thomas, head of international recruitment at Banque Saudi Fransi, says wide-spread redundancies seem unlikely, but recruitment has slowed.

"There's a focus on containment of costs at the moment and recruitment within financial services in the kingdom is now restricted to replacement hires and certain specialist areas," he says.

Bill Allum, managing director of Napier Search and former Saudi-based investment banker, says some international banks still have an appetite to hire: "I know of a number of global players who continue to view the Saudi market as a growth area and are expanding their teams accordingly."

However, one investment banker at a Saudi firm, believes international players are finding it tough: "We have a purely regional focus and are in a stronger position than international firms whose activities in this part of the world are not too important in the global scheme of things."

Similarly, one headhunter says Deutsche Bank may have over-hired in Saudi: "A 50-man team in Saudi is large for an international bank, particularly now. Most have 15-20 people, predominantly business originators, supported by people outside of the region."