Germany’s Berenberg to cut dozens of staff in equities division
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Berenberg, the German private bank, is laying off dozens of staff in its equities business and “resetting” the headcount in that division back to 2017 levels, marking a sudden about-turn after a recent hiring spree.
“After many years of successful growth and a planned autumn 2018 review of our structure, we are re-setting equities headcount back to the beginning of 2017,” the Hamburg-based investment bank said in a statement. Many of its equities roles are based in London.
One person with knowledge of the situation said that the group was letting go around 35 people in London alone, including 25 from the research department and 10 from sales and corporate finance.
One broker at the company said there had been a “round of [redundancy] consultations” held at its London office on Tuesday.
Berenberg, which only has minimal reporting obligations as a privately owned company, declined to comment on how many redundancies it was making or to disclose details of the 2017 or 2018 headcount for its equities business.
It said it was making the changes “from a position of strength”. It added: “In the first half of 2018 we have made strong market share gains in cash European equities and ECM.”
The move by the world’s second-oldest bank comes just months after it told the Financial Times it planned to continue expanding its London equities business, despite growing pressure from tough new European regulations known as Mifid II.
The new rules mean fund managers now have to pay for investment research, which has forced asset managers to reassess — and in many cases, cut back — what they consume. This, together with a subdued market for initial public offerings, has hit the performance of many listed stockbrokers recently.
Berenberg currently employs about 1,600 staff in total, around 350 of which are based in London. On top of its equities business, it has wealth and asset management and corporate banking divisions in Germany, and a small London-based wealth and asset management team.
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