INVESTEC could join the flurry of banks laying off staff if conditions worsen, managing director Bernard Kantor told City A.M. yesterday as the bank reported a small drop in profits.
“As much as we don’t like to hire and fire, we have to live in the same world as everyone else,” he said. “It’s tough out there… This [economic turmoil] could be with us for a very, very long time.”
Investec’s investment bank saw profits plunge by 91.4 per cent to £3.66m for the six months to September this year, but Kantor insisted there are not yet plans to lay off staff beyond the 140 in job cuts due to the closure of the broking division of Evolution Group, which Investec bought recently.
Overall, the bank saw six-month operating pre-tax profits dip by two per cent to £223.6m in part due to further impairments in its private bank, which lost £4.9m. Total impairments at the private bank are on the rise, reaching £286.7m for the six months to October, up from £269.5m in the previous half year.
However, six-month operating profits at both its asset management and wealth management businesses rose by over a third to a combined total of £87.4m. The bank’s strategy is to continue its shift into managing assets, which delivers a steadier income stream than investment banking.