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The other banks that quietly cut 300 jobs in recent months

If you were hoping that 2024 would mark a reversal in the prevailing winds of 2023 and that banks would start hiring again, first quarter results from the Canadian banks suggest disappointment.

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Canadian banks’ first quarter ends on January 31st, with the result that all report ahead of big US and European rivals. All have been cutting jobs in their capital markets divisions (investment banks).

This includes Toronto Dominion Bank, which reported today. In the past three months, TD cut nearly 250 jobs in its capital markets division as it prunes the circa 2,000 employees it added as part of last year’s acquisition of Cowen Inc in March. Integration costs contributed to a 14% reduction in net income.

While TD cut more than rivals, RBC Capital Markets and Bank of Montreal also trimmed in the first quarter. BMO let go of 21 people from its capital markets team in the three months to January. RBC let go of 45. 

The cuts come amidst spotty revenues. At TD, markets revenues are up 47% year-on-year on the Cowen acquisition and banking revenues are up 15%. At RBC, however, markets revenues are down 8% and banking revenues are up only 3.5%. This is clearly not enough to encourage hiring.

As we reported earlier this week, JPMorgan CFO Jeremy is predicting a “mid-teens” increase in JPMorgan investment banking revenues both year-on-year and quarter-on-quarter, but a 5-10% decline in markets revenues. Goldman Sachs CEO David Solomon is predicting that investment banking revenues will return to their 10-year average, but admits that this hasn’t happened yet. 

The US banks don’t report their first quarter results until April.

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