“We are now introducing additional targeted measures for our workforce.”
(Photo: Reuters)
new York Goldman Sachs is warning investors of a sharp downturn in investment banking. Wall Street size must be prepared for a decline in the face of an “extraordinarily challenging” economic environment. A year ago, investment banking was responsible for record profits.
“We are now taking additional targeted actions on our headcount,” Goldman President John Waldron said Thursday at a conference hosted by asset management firm Alliance Bernstein. “We are preparing for a tougher environment.”
Waldron also said the bank’s trading business declined by more than a quarter year-on-year in the quarter. He described capital market activities as “sluggish”, although the stock markets have recovered since the beginning of the year.
Goldman shares ended the New York session down 2.3 percent at $316.40. Since the beginning of the year, the papers have yielded almost eight percent.
Waldron also emphasized that the investment bank observed a “rather risk-averse tone” among its customers. The company bosses are also cautious. “We have a feeling that we will have a contractionary environment for a period of time.”
Earlier this week, Bloomberg reported that Goldman was preparing its third round of job cuts in less than a year. The money house cut hundreds of jobs in September, followed by about 3,200 earlier this year. This time, almost 250 employees are said to be affected, but also executives, Bloomberg reported, citing insiders.
Goldman shares ended the New York session down 2.3 percent at $316.40. Since the beginning of the year, the papers have yielded almost eight percent.
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