Is Nomura about to make rates layoffs too?

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Nomura's mid-August credit layoffs sent a chill through trading floors in London. The temperature could be about to fall a few notches again. - Rumour has it that the Japanese bank is about to make further redundancies on its rates desk.

"People are saying that Nomura is about to follow its credit cuts with some rates layoffs," says one headhunter, speaking on condition of anonymity. "It makes sense as they were hiring in rates until recently and now look overstaffed." Other fixed income headhunters confirmed they were hearing the rumours too.

Nomura declined to comment on the redundancy allegations, although some insiders said a second round is unlikely. Revenues in the bank's fixed income business fell 26% in the most recent quarter compared to one year earlier.

Most of the 60 redundancies made at Nomura in August afflicted the bank's credit trading business, with high yield and CDS traders and salespeople most affected. However, the Japanese bank laid off a few rates traders last month. Matt Norways, a trader who joined in 2007 from Portigon, a portfolio service provider, went. So too did Alano Regueiro, a rates salesman who joined from Lehman in 2008.

Headhunters said Nomura's unwanted traders have yet to find new jobs elsewhere. This is unsurprising given that many are still in their notice periods and trying to get negotiate generous exit packages. When they do stick their heads above the parapet, they're likely to find the hiring terrain fairly inhospitable. - Smaller banks like Mizuho, Mitsubishi, Unicredit and Santander may be glad of their services but larger banks are cost cutting too.

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