Evolution axes 60 investment banking jobs

Evolution Group, the mid-sized investment bank that is being taken over by South African rival Investec, said it will cut 60 jobs as a result of tough market conditions.

"Due to the current depressed levels of income within the business, management has taken action to reduce the cost base from quarter four onwards," Evolution said in a statement.

"This has been achieved by reducing headcount by 60 employees and continuing to have a disciplined approach to all areas of discretionary expenditure."

Evolution employs around 500 people.

Evolution added that its investment banking division was currently making an operating loss, although the overall performance of the group, which also runs a private client wealth management arm, was in line with the company's expectations.

In September, Investec announced that it was acquiring Evolution for £233m in order to boost Investec's wealth management and broking arms and that job cuts would be likely.

Many of Britain's smaller investment banks have had to seek out mergers or buyout deals after being hit by the financial market downturn, caused by Europe's sovereign debt crisis, and increasing regulatory costs.

American investment bank Evercore Partners bought advisory firm Lexicon Partners in June, while in February 2010 Portuguese lender Banco Espirito Santo bought a majority stake in stockbroker Execution Noble.

Evolution itself made an attempt last year to buy rival Panmure Gordon but ended up dropping the bid.