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Wednesday, 22 October 2008
Bankers asked to fly coach
Merrill Lynch , UBS and JPMorgan & Chase are telling senior bankers in Asia to fly coach on short-haul flights and reduce non-essential travel as they step up cost cuts, officials at the firms said.
Merrill Lynch , UBS and JPMorgan & Chase are telling senior bankers in Asia to fly coach on short-haul flights and reduce non-essential travel as they step up cost cuts, officials at the firms said.
According to Bloomberg news, UBS advised bankers this month to travel economy class for flights of up to five hours, two officials at the biggest Swiss bank said.
Merrill employees have been told to travel economy for flights of up to three hours since mid-September, two executives at the firm said.
The world’s largest banks and securities firms are trimming costs to survive the credit-market meltdown that toppled Lehman Brothers and forced Merrill Lynch to sell itself to Bank of America.
The financial-services industry has cut more than 140,000 jobs since a surge in subprime mortgage delinquencies began to roil global debt markets in 2007, said Bloomberg.
‘Investment banking has almost disappeared in this market, and with revenue shrinking severely, it’s sensible to cut every single type of cost they can,’ said Mr Renault Kam, a senior portfolio manager at Atlantis Investment Management in Hong Kong, which oversees US$5 billion (S$7.5 billion). ‘We haven’t seen the worst yet.’
JPMorgan, the biggest US bank, has requested senior bankers fly economy on flights less than three hours since late August, said an official who declined to be identified.
Airlines pinched HSBC Holdings Plc’s Asia unit asked its Hong Kong department heads and branch managers to cut travel expenses by 15 per cent to 20 per cent next year, two officials at the bank said, citing a Sept 23 memo sent by Chief Operating Officer Jon Addis.
HSBC is recommending lower-cost China Eastern Airlines, the country’s third-biggest carrier, over Hong Kong Dragon Airlines for business trips to Shanghai, the memo said, according to the people.
Europe’s biggest bank by market value cut 1,100 jobs in its global banking and markets division last month.
Airlines are feeling the pinch. Cathay Pacific Airways, Dragonair’s parent, on Oct 13 reported the first drop in traffic in 20 months and said demand out of Hong Kong ‘slowed significantly’ as the credit crisis damped business travel.
Singapore Airlines, the world’s biggest carrier by market value, also recorded declines in traffic.
Deals terminated Mergers and acquisitions worldwide have fallen 30 per cent to US$2.43 trillion this year from the same period in 2007, according to data compiled by Bloomberg. Global equity offerings fared even worse, slumping by half to US$292 billion.
Pain from the worst US financial crisis since the Great Depression is spreading into Asia as stocks tumble and companies cancel acquisitions, stake sales and equity offerings.
Merrill job cuts UBS was forced into a US$59.2 billion government bailout last week and Merrill, following its emergency sale to Bank of America last month, plans to cut about 500 jobs in its trading division, three people with knowledge of the plan said on Oct 21.
About 75 of those positions will be in Asia, said a bank official who declined to be identified.
‘UBS always seeks to control its costs,’ said Mr Chris Cockerill, a Hong Kong-based spokesman at the firm. ‘In the current financial environment we are reviewing all potential areas where greater savings can be made, and travel is one of them.’ He declined to elaborate.
London-based HSBC has asked its bankers to use video conferencing to replace business trips when possible. Travelers for corporate training or internal meetings are required to book economy seats, spokesman Gareth Hewett said.
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Bankers asked to fly coach
22 October 2008
Merrill Lynch , UBS and JPMorgan & Chase are telling senior bankers in Asia to fly coach on short-haul flights and reduce non-essential travel as they step up cost cuts, officials at the firms said.
According to Bloomberg news, UBS advised bankers this month to travel economy class for flights of up to five hours, two officials at the biggest Swiss bank said.
Merrill employees have been told to travel economy for flights of up to three hours since mid-September, two executives at the firm said.
The world’s largest banks and securities firms are trimming costs to survive the credit-market meltdown that toppled Lehman Brothers and forced Merrill Lynch to sell itself to Bank of America.
The financial-services industry has cut more than 140,000 jobs since a surge in subprime mortgage delinquencies began to roil global debt markets in 2007, said Bloomberg.
‘Investment banking has almost disappeared in this market, and with revenue shrinking severely, it’s sensible to cut every single type of cost they can,’ said Mr Renault Kam, a senior portfolio manager at Atlantis Investment Management in Hong Kong, which oversees US$5 billion (S$7.5 billion). ‘We haven’t seen the worst yet.’
JPMorgan, the biggest US bank, has requested senior bankers fly economy on flights less than three hours since late August, said an official who declined to be identified.
Airlines pinched
HSBC Holdings Plc’s Asia unit asked its Hong Kong department heads and branch managers to cut travel expenses by 15 per cent to 20 per cent next year, two officials at the bank said, citing a Sept 23 memo sent by Chief Operating Officer Jon Addis.
HSBC is recommending lower-cost China Eastern Airlines, the country’s third-biggest carrier, over Hong Kong Dragon Airlines for business trips to Shanghai, the memo said, according to the people.
Europe’s biggest bank by market value cut 1,100 jobs in its global banking and markets division last month.
Airlines are feeling the pinch. Cathay Pacific Airways, Dragonair’s parent, on Oct 13 reported the first drop in traffic in 20 months and said demand out of Hong Kong ‘slowed significantly’ as the credit crisis damped business travel.
Singapore Airlines, the world’s biggest carrier by market value, also recorded declines in traffic.
Deals terminated
Mergers and acquisitions worldwide have fallen 30 per cent to US$2.43 trillion this year from the same period in 2007, according to data compiled by Bloomberg. Global equity offerings fared even worse, slumping by half to US$292 billion.
Pain from the worst US financial crisis since the Great Depression is spreading into Asia as stocks tumble and companies cancel acquisitions, stake sales and equity offerings.
Merrill job cuts
UBS was forced into a US$59.2 billion government bailout last week and Merrill, following its emergency sale to Bank of America last month, plans to cut about 500 jobs in its trading division, three people with knowledge of the plan said on Oct 21.
About 75 of those positions will be in Asia, said a bank official who declined to be identified.
‘UBS always seeks to control its costs,’ said Mr Chris Cockerill, a Hong Kong-based spokesman at the firm. ‘In the current financial environment we are reviewing all potential areas where greater savings can be made, and travel is one of them.’ He declined to elaborate.
London-based HSBC has asked its bankers to use video conferencing to replace business trips when possible. Travelers for corporate training or internal meetings are required to book economy seats, spokesman Gareth Hewett said.
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