Barclays, HSBC, BoA among big European, US Banks Job Cuts, Hard Hit !

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Barclays job cuts take Europe’s tally to 40,000

Swiss firms hit by impact of soaring franc

LONDON (MarketWatch) — A running tally of planned job cuts by European banks reached around 40,000 Tuesday, little more than halfway though earnings season, as firms that failed to control costs or were over-optimistic about growth make the deepest cuts.

Barclays PLC UK:BARC -0.12%   BCS -0.84%  was the latest to confirm job losses Tuesday, saying it’s already cut 1,400 jobs and indicating the figure could rise to around 3,000 by the end of the year.

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The announcement came as the bank reported a 38% drop in net profit to 1.5 billion pounds ($2.45 billion), partly due to compensation it’s paying to customers who were sold inappropriate insurance.

The Barclays cuts take the total announced by banks reporting in the last week to 35,000. On top of that, UBS AG CH:UBSN -7.70%   UBS -4.68%  also confirmed it would slash jobs, with media reports in Switzerland pegging the number of losses at around 5,000.

The total doesn’t include a further 15,000 job cuts announced by Lloyds Banking Group PLC UK:LLOY -3.02%   LYG -4.46%  at the end of June.

Strong franc hurting Swiss banks

UBS and Credit Suisse CH:CSGN -7.77%   CS -4.16% , which is cutting around 2,000 jobs, are facing an uphill battle against the soaring Swiss franc because they have such a big cost base in Switzerland, but receive a lot of their revenue in dollars and euros.



On top of that UBS CEO Oswald Gruebel made a significant effort to rebuild the firm’s fixed-income trading business in the wake of the crisis, but is now cutting back in areas where it’s not making money, said Christopher Wheeler, an analyst at Mediobanca.

“Ozzie is a trader and he’s taking a trader's view by cutting his positions,” said Wheeler.

HSBC Holdings PLC UK:HSBA +0.43%   HBC -0.20%  will cut around 30,000 positions by 2013, reflecting the fact that the bank “massively over-expanded in retail banking,” Wheeler added.

Soaring costs at HSBC have been a significant worry for investors for some time, leading the bank to announce in May that it will withdraw from markets where it can’t achieve the right scale. Read more on HSBC's cost-cutting plans. 
 

Societe Generale analyst James Invine said in a note to clients that costs are still “a mountain to climb” for HSBC and that much of the growth is due to wage inflation in its faster-growing markets.

“That is a cost about which it can do very little, particularly given Asia’s strategic importance for the group,” Invine said.

The Barclays cuts are a mix of trimming a bloated looking corporate banking arm and slimming down European retail banking, as well as trimming its Barclays Capital investment banking arm after some pretty aggressive expansion, said Wheeler.

Barclays was the bank that snapped up the U.S. operations of Lehman Brothers Holdings, including around 10,000 staff, after the U.S. firm collapsed in 2008.

“In bull markets, you can hide a lot,” he said.

“But when you get into these sort of markets you have to address it, because, it sticks out like a sore thumb.”

Simon Kennedy is the City correspondent for MarketWatch in London.

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HSBC Plc is reportedly close to announcing that it will cut thousands of jobs as it embarks on a cost-cutting drive. — Reuters

HSBC may cut 10,000 jobs

HONG KONG: HSBC Plc may cut more than 10,000 jobs as it embarks on a cost-cutting drive, Sky News reported, citing people close to Europe's biggest bank.

The bank's plans had not yet been finalised, Sky News added, citing an insider at the bank

A HSBC spokeswoman in Hong Kong declined to comment.

HSBC's move would be the latest in a wave of cuts announced by the global financial industry, which has been hit by market volatility and lacklustre profits.

Just yesterday, Swiss bank Credit Suisse announced it would cut about 2,000 jobs after a second quarter hit by weak trading activity and the strong Swiss franc.

 

Switzerland's second biggest bank saw net profit fell 52% to 768 million Swiss francs (US$958.9mil), it said on Thursday.

Standard Chartered, Lloyds, Goldman Sachs and UBS are among banks that have announced job cuts in recent months, hit by rising costs and weak revenue growth.

State Street Corp, one of the world's biggest institutional investors, said earlier this month it would eliminate as many 850 jobs from its technology unit as it tried to curb costs.

HSBC has about 330,000 employees worldwide.

The Sky report came after it said in May it was looking for sustainable cost savings of US$2.5bil to US$3.5bil in order to reach a cost efficiency ratio target of 48%-52% by 2013.

It also said it would be conducting a strategic review of its cards business in the United States, and would limit its retail banking operations to markets where it could achieve profitable scale.

It already cut 700 jobs in its UK retail banking arm in June this year out of its staff of 55,000 in the country, one of many banks that have said they will cull jobs to save costs as lenders fight off a limp economic recovery.

HSBC shares in Hong Kong were down 1.1% by noon yesterday, in line with the broader market's 1% decline. - Reuters

Big Banks Hit Hard In Market Sell-Off

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Big U.S. and European banks were hit hard in Thursday’s stock sell-off, highlighting investor concerns about some of the more prominent financial institutions.

In the U.S., Bank of America’s stock fell by 7.44% and has now tumbled by 33% this year. Bank of America’s chief executive, Brian Moynihan, will now really have his work cut out for him next week when he plans to take questions on a public call hosted by Bruce Berkowitz, the rock star hedge fund manager who has taken a big and controversial position in the nation’s biggest bank.

The KBW Bank Index fell by 5.3%, but some of the biggest banks in the U.S. fell more, like Citigroup, which fell by 6.6%. Big banks like Citigroup are struggling to deal with surging litigation costs stemming from the credit crisis while also dealing with more stringent capital standards.

The situation in Europe is worse, where investors are starting to wonder more and more about the Italian government securities being held by the large European banks, not to mention IOUs from the other countries like Spain. Italy is really getting more mired in the euro crisis and UniCredit shares tumbled by more than 9% on Thursday. Lloyds Banking Group has now seen its shares lose nearly half their value in 2011.

The decline in bank stocks could add momentum to the job cuts already being implemented on Wall Street and the banking sector. HSBC recently said it would slice 30,000 jobs. It will also potentially weigh on the economic recovery. But at least some banks are making the best of an ominous situation. Bank of New York Mellon said on Thursday it will start to charge clients fleeing to safety a fee for extraordinarily high deposits.

Successful Leadership to Elevate Your Career and Your Organization

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10 Steps to Successful Thought Leadership to Elevate Your Career and Your Organization

As employees seek to strengthen their identity in the workplace they must find ways to make an immediate impact for the betterment of the company as well as themselves.  This requires a commitment to share your voice with others so that your influence can be naturally felt throughout your team, your department and the organization.   Strengthening your identity is not a self-serving act, but rather a responsibility to those that you serve.  The goal is to become a thought leader.

What is a Thought Leader?

A thought leader is a person who identifies trends, common themes and patterns within a particular industry or functional area of expertise to help others identify new opportunities or solutions for growth.

Most people believe that thought leadership is only for senior executives. In the traditional workplace, this still is the case. However, in the new workplace where the sharing of ideas is welcomed regardless of hierarchy or rank, any employee can be a thought leader. In today’s business world, the most relevant employees are starting the conversations – and benefitting both individual and corporation.

What are the steps to becoming a thought leader as an employee in your organization?

In the brave new world created by the economic shifts of the last 5 years, successful participants will let go of old-fashioned thinking, change their resource model and vision, and begin to get to know the new hierarchy. They’ll launch their thought leadership based on the strength of their onsite and online community that they have developed.  And they’ll develop an identity that will give them longevity and security in an insecure world.

After many years of developing my thought leadership platform (The Immigrant Perspective), I would like to help you with yours.   Here are my (10) most effective steps to successful thought-leadership:

1. Define and Manage How Other People Experience Your Personal Brand.
Before you can become a recognized thought leader, you must define and manage how other people will experience the following four characteristics of your personal employee brand:

• What is your brand’s enduring idea?
• How will your brand best differentiate itself?
• What is the primary experience your brand will deliver?
• Whom will your brand serve?

2. Identify the Methodology that Defines the Problems Your Personal Employee Brand Solves. 

You may be knowledgeable about a particular subject matter, but have your experience and insights given you enough breadth and depth to earn the right to propose solutions in your area of expertise? As a thought leader, your personal employee brand must support a proven step-by-step methodology that defines the approach for the problems your brand solves. Your methodology must be able to show how to overcome the most challenging set of circumstances.

3. Manage Your Thought Leadership Profile.

A thought leadership profile is your management tool that keeps your personal employee brand, methodology and subject matter expertise updated, fresh and relevant. This profile should be a living document that you update on an ongoing basis. The following are the primary elements to include in your thought leadership profile:

•  Subject matter expertise
• Problems that my thought leadership solves
• My methodology
• Target audience
• Industry pain points
• Industry opportunities/ROI outcomes
• What my audience needs to hear
• Targeted media outreach
• Conversations and topic ideas for articles, blogs, tweets and video blogs.

 4. Write it Down! Share Your Ideas and Experiences.

Seasoned thought leaders know that writing and sharing of experiences is a natural extension of their leadership role and responsibility. Convert concepts into practical applications that support your methodology. Be innovative in your thinking, yet simple in your writing style. Don’t limit your audience.

In your thought leadership profile, prepare a list of topics of conversation that you would like to share with your audience. Create a list of useful resources to support your writings. Demonstrate that you can articulate complex issues in terms that a broad audience can understand and apply. Show your audience that you care about the problems that it is trying to solve. Assemble a “knowledge vault” of materials that support your writings to further demonstrate your commitment to solve your audiences’ problems.

Finally, allow your community to connect with you personally in your writings. Share personal stories that support your content themes. People want to connect with your voice in ways they can relate to personally. Sharing your personal identity (within reason) allows for a more purposeful and meaningful relationship to blossom.



5. Speak and Speak Some More.

Writing is your starting point to speaking and articulating your thought leadership ideas and ideals. Identify trade shows and conferences that customers and industry influencers are attending and participate on panels or lead workshops. Find out about the local associations that host speaking events and offer to give a keynote or sit on a discussion panel.

Your ability to remain active as a speaker is critical to becoming a sustainable thought leader. When speaking, focus on providing useful information. No one wants to listen to you pitching your product. You are there to inform and educate, to provide a unique perspective.

6. Create a Blog and Activate Your Social Media Tools.

Create your own blog and activate your favorite social media tools (ie. Twitter, Facebook, LinkedIn, YouTube, etc.) to make it easy for your community/audience to follow your writings, upcoming speaking engagements, trade interviews, media appearances, etc. As a selected voice that represents your organization, your blog and social media tools must be a prominent and visually appealing outlet that supports an interactive two-way exchange of knowledge and ideas with your community.

7. Share Your Secrets and Build Trust with Your Community.

Make it simple for people to access your content. In the end, thought leadership is about building a trustworthy relationship with your community. You begin to lose that trust once you appear to be holding something back. No secrets allowed! Though your community may not always be responding (in the form of commentary), they are reading and listening to your words carefully. Your content (regardless of format) is generating a two-way communication stream of thought, ideas and trust.

8. Cultivate Purposeful Relationships with the Media.

Don’t leave it solely to your PR agency. As a thought leader, you should have a list of 15 writers and editors who regularly report on your industry market. Journalists are very busy people, always on a deadline. So, when you call you need to give them something that they can use to make their life better and easier – a lead, a story, some insight, a quote, customers to whom they can talk for quotes.

Don’t wait for the media to find you. You must be proactive in building relationships with the media. Research media outlets and key contacts that would benefit from your subject matter expertise. You can always hire a PR agency, but when getting started it’s best to get your hands dirty and learn how the media really works yourself.

9. Control Your Google Identity and Relevancy.

In today’s business world, people initially experience your personal brand identity and its relevancy as defined by Google. When you Google a person’s name you immediately create an impression of that person based on what you read and its context. So who is controlling your Google identity and relevancy? Is it Facebook, LinkedIn, YouTube, or Twitter? Or, is it your blog and its articles, video blogs, white papers and all of your original content that supports your methodology and what defines the experience of your personal brand?

As a thought leader, you must become best friends with Google. You must be accountable to manage how Google positions your personal employee brand and subject matter expertise. This inherent responsibility is important not only for your own personal benefit, but more so for your community. How do you control your Google identity and relevancy? Follow points 1 – 8!

10. Make a Commitment to Thought Leadership!

The sharing of ideas and insights do not require your organization to have market share dominance or millions of dollars. In today’s new normal, content is a commodity and readily available. Thought leadership is a difference maker. Your generosity and transparency can help you outsell your competitor. It can lead to higher margins. In a world in search of trust, it’s all about people and your thought leadership will expand the breadth and depth of who you are as a person and how others interact with you.

We are transitioning from a knowledge-based economy to a wisdom-based economy. It’s no longer just about what you know, but what you do with what you know. It’s about trust, transparency, opening up your heart and leading with kindness. Thought leadership is another form of corporate social responsibility. It’s about leaving a legacy and earning the respect of your community.

Thought leadership is your path to career security, continuing relevance, and a vibrant company environment.  It is no longer optional for those who want to control their path through business life; it is mandatory.

May my journey help you with yours!  May this immigrant perspective serve you well.

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US Debt deal reached to avoid default, what others are saying?

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What China, Others, Are Saying About US Debt Deal?

Debt ceiling raised...again.

President Barack Obama said Sunday night that both houses of Congress finally reached an agreement to reduce the budget deficit and avert a debt default that would have likely sent the country into a recession.

“Leaders of both parties, in both chambers, have reached an agreement that will reduce the deficit and avoid default — a default that would have had a devastating effect on our economy,” Obama said in his remarks to the White House press Sunday shortly after the bill was signed. The first part of the debt deal cuts nearly $1 trillion from the federal budget over the next decade. Exact details were not immediately available.

“The result would be the lowest level of annual domestic spending since Dwight Eisenhower was President,” Obama said. The debt limit and cut spending between $2 trillion and $3 trillion.

The Economic Times of India polled readers who said overwhelmingly that the Indian market would be impacted on Monday as investors in the US digest this weekend’s news. A total of 85% of the paper’s readers polled on line said it would impact India’s market all week.

Russian newswire columnist Andrei Fedyashin said recently, before Sunday’s deal, that “cuts in social spending and higher taxes are still the only way of reducing budget expenditures and a country’s sovereign debt.”



Yao Yang, director of the China Center for Economic Research at Peking University, weighed in at China Daily. He said that the US deficit problem “is ultimately the result of the conundrum of a welfare state following the capitalist system. Both are uncompromising ideals cherished by a substantial percentage of the population. The fight will resurface in the future even if the present deadlock is broken. There is a lesson for other countries here. The best a country can do is to fence off the contagious effects of such fights and rely more on the domestic economy for further growth.”

Also reprinted in China Daily, Mohamed El Erian, CEO of PIMCO, says, the next few weeks will provide plenty of political drama. “The baseline expectation, albeit subject to risk, is that Democrats and Republicans will find a way to avoid disruptions that would damage the fragile US economy, but that the compromise will not meaningfully address the need for sensible medium-term fiscal reforms.”

In Brazil, an article in Folha de São Paulo, the country’s largest daily newspaper, said that Americans woke up too late to its serious spending problems. Not only government spending, but consumer spending as well. A foreign correspondent for the paper interviewed US think tanks and scholars who said that the average US citizen was “uninformed” about the country’s economy and pending debt crisis. Despite having nearly every country south of Texas run into similar debt dead ends, the US — printers of the world’s reserve currency and the largest economy — didn’t seem to flinch when society, and government, became overweight with debt. The US is in a unique world situation because of its status as world’s reserve and trade currency, and issuers of the most trustworthy debt in the market.

“Americans are not well informed about the economic crises that occurred in other countries to learn from them,” said Isabel Sawhill, an analyst from the Brookings Institute in Washington. “They don’t see any parallels with crises in other countries because they think the US has the capacity to resolve all problems.
The population knows there is a problem, they just don’t know to what extent or where it comes from.”

Linda Bilmes, a former government consultant turned Harvard lecturer in Cambridge, the main problem with the debt deal is taxes and political ignorance over tax laws. “The biggest reason our debt is so high is because George W. Bush cut taxes two times exactly when we were spending money on two wars,” Bilmes told Folha. “In the last two major US wars, taxes went up to support those expenditures.”

See: White House, Congress Reach Debt Deal

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