DealBook: European Banks Prepare More Job Cuts

LONDON — Less than a week into the new year, European banks are already planning new job cuts.

Société Générale, the second-largest French bank, announced an agreement on Wednesday with its trade unions for about 880 “voluntary departures” in its domestic investment banking business, starting in April. An additional 700 layoffs are expected in the bank’s international investment banking operations, including in New York and London, according to a company spokeswoman, Nathalie Boschat.

The Royal Bank of Scotland has hired the advisory investment bank Lazard to find a new owner for its struggling equities business, according to a person familiar with the matter.

That news comes as R.B.S., in which the British government holds an 83 percent stake after providing the bank a £20 billion ($31 billion) bailout in 2008, is attempting to reduce its investment banking unit, which currently employs about 19,000 people.

R.B.S. plans to eliminate 2,000 jobs from its global banking and markets unit in the next 12 to 18 months in response to the volatile financial markets and Europe’s debt crisis. The bank has already eliminated more than 30,000 jobs since 2008.

European banks have been cutting jobs aggressively.

In France, Crédit Agricole said late last year that it planned to eliminate 2,350 jobs as part of an effort to adapt to continued instability in world financial markets, and BNP Paribas has also announced plans for 1,400 layoffs.

The Swiss banks Credit Suisse and UBS each plan to eliminate 3,500 jobs as they shift their focus away from investment banking to their profitable wealth management operations.

The layoffs in Europe’s banking sector come as financial firms look to rein in costs and increase capital buffers to meet tough new regulatory requirements by June.

Banks have also been buffeted by the European sovereign debt crisis, which has wiped out billions of euros’ worth of shareholder value. The Euro STOXX banks index, made up of the largest banks in the euro zone region, has fallen 42 percent in the last year.

Shares in the Italian bank UniCredit, which fell on Wednesday after the bank offered newly issued stock to existing shareholders at a 43 percent discount in an effort to raise capital, continued to slide on Thursday. In afternoon trading in Milan, the share price had fallen 14 percent, to the lowest level since the 1990s.

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