Barclays and Citi reportedly prepare for investment bank job cuts amid dealmaking slump

Banking giants Barclays and Citigroup are reportedly preparing to cut jobs in their investment banking divisions as the sector grapples with a slowdown in dealmaking.

Barclays is getting ready to axe several hundred roles in the coming months, with the final figure yet to be finalised, Bloomberg News reported.

Sources said the layoffs were part of Barclays’ annual cutting of low performers. The bank last month said it would split up its corporate and investment bank as part of a wider restructuring, although some have urged it to ditch the arm entirely as it generates more volatile earnings and lacks the scale of Wall Street rivals.

Citi, the US’ third-largest bank by assets, is reportedly preparing to axe 20 roles in London, mainly affecting junior staffers at the analyst to director level.

The news comes as chief executive Jane Fraser has embarked on a major restructuring of the group, including 20,000 overall job cuts. She’s made the leaders of its five key divisions part of her executive management team.

One of these leaders will be Vis Raghavan, who Citi has poached from JP Morgan to run its new banking division, comprising dealmaking, capital markets, and commercial and corporate banking.

City A.M. approached Barclays for comment. Citi declined to comment.

Interest rate hikes across both sides of the Atlantic have triggered a slump in dealmaking in recent years, with bosses reluctant to commit to M&A due to economic uncertainty.

Data from Bain showed the value of M&A globally dropped 36 per cent last year to a decade low, although executives remain confident for a rebound in 2024.

Fraser said at an investor conference earlier this month that market sentiment was “definitely improving”.

Global investment banks have shed dealmaking jobs in a bid to cut costs and reverse post-pandemic overhiring, including JP Morgan and Goldman Sachs in recent months.

Analysis of job openings at Citi, Barclays, JP Morgan, Morgan Stanley and HSBC by website Vacancysoft found that vacancies plunged 50 per cent last year.