Banking giant Credit Swisse is making cuts into its foreign-exchange unit in efforts to shrink the fixed-income division. According with those familiar with this situation, the bank is offering members a “redundancy” package. Employees in the forex unit will has a set time to find another position within the bank or leave entirely. At least six employees have been offered such terms within the New York and United Kingdom locations.
Of the six employees in question, two are in high ranking positions: head of spot trading, in London, Daniel Wise and Mark Astley, a director in FX strategist. In order to shrink the unit, Credit Swisse’s commodities and rates division absorbed the remaining forex operations to make room for structural changes.
Credit Swisse is aiming to cut costs by roughly $200 million within the division, along with leverage and risk-weighted asset reduction, according to Chief Financial Officer David Mathers. The cur has been evident in the Euromoney Institutional Investor’s annual survey that ranks the top 20 currency dealers. The firm fell four spots to 12th with volumes dropping 1.63 percent.
Chief Executive Officer Brady Dougan said “we were never really that large of a player in the foreign-exchange markets.” The firm will focus on more profitable business models, such as equities, underwriting and credit-securitized products.
Credit Swisse has not been the only large firm to make structural reforms. Institutions like JP Morgan, Goldman Sachs, and others, have been cutting down or selling off low-margin and profitable units, such often include forex and commodities.