BNP Paribas's London layoffs less painful than they seem
BNP Paribas is letting go of 233 people in London. So says Reuters, which says 100 of them have already been identified and that 17 of them are from the securitisation team (amounting to 50% of that team's total headcount at Harewood Avenue).
The horror. Except, BNP Paribas employs a total of 7,500 employees in the UK by its own account, of whom 3,105 are in its corporate and investment bank according to Reuters, suggesting the cuts amount to either 3% or 8% of the total, depending upon how you look at it.
BNP didn't respond to a request to comment on the nature of its layoffs, but sources close to the bank said they will affect the corporate banking business rather than global markets and that (securitization aside) any global markets jobs that are impacted are most likely to be support roles. Nonetheless, we understand that some individuals in BNP's research team - including Ken Wattret, co-head of European economics - are among the 100 people who have been informed that their jobs are at risk.
Wattret informed us that he's still employed by BNP and declined to comment further.
While it's cutting in London, Reuters says BNP is doubling its headcount in Poland, from 328 to 579 employees. The implication is therefore that 179 of the 233 jobs that are cut in London (or 77% of the total) will be moved to Poland. So, yes, the London layoffs are mostly in support functions.
Earlier this month, BNP was said to have been asking unwanted employees in its corporate and investment bank to accept "mobility" - a euphemism for moving to another role within BNP that may pay less money. Costs in BNP Paribas' corporate and investment bank amounted to 85% of revenues in the first quarter, up from 75% a year previously, so the French bank needs to cut costs urgently. In a note out yesterday, analysts at Bernstein Research said BNP's investment banking business will be a drag on P&L in the short term, at least. For the moment, BNP is advertising no jobs in Poland, but we assume it will start to do so very, very soon.