(Bloomberg) -- Credit Suisse Group AG, the Swiss lender seeking to lower costs at its investment bank, cut two equity analyst positions in Dubai and reduced jobs in South Africa, including researchers covering stocks, according to people familiar with the matter.
Switzerland’s second-biggest bank will cover some South African and Gulf stocks affected by the changes by using existing research staff elsewhere, two of the people said, asking not to be identified because the information is private. Credit Suisse equity analysts in other emerging markets may also be affected, one of the people said.
Chief Executive Officer Tidjane Thiam has said that the bank is looking for ways to reduce expenses at its trading unit after it racked up about $1 billion in unexpected writedowns. Europe’s largest lenders have been under pressure to restructure their securities businesses as volatile markets erode revenue. Thiam plans to boost Credit Suisse’s profitability by focusing on Asia-led wealth management and said in a Sept. 27 presentation that Credit Suisse is on track to meet its goal of 6,000 job cuts this year, with 1,200 still to come.
After quitting a joint venture with Standard Bank Group Ltd., Africa’s biggest lender by assets, in 2010, Credit Suisse set up its own equities team in Johannesburg. In 2012 the European bank decided to expand the unit and added six people to the team. In this year’s Financial Mail magazine’s analyst-ranking survey, Credit Suisse didn’t win any categories. Other parts of the South African business won’t be affected by the job cuts, one of the people said.
Derek Hompes, the head of South African equities in Johannesburg, referred queries to the company’s London unit, which said the bank remains “committed to the Middle East and Africa and our research offering in the region.”
The bank’s head of global markets research, Stefano Natella, a 27-year veteran of Credit Suisse, quit last week along with Ric Deverell, who headed global fixed income and economic research, according to an internal memo obtained by Bloomberg News.
“Unfortunately, paring back teams will likely continue, especially where there is a lack of critical mass,” Bloomberg Intelligence analyst Jonathan Tyce said in response to e-mailed questions on Friday. “The traditional business model is increasingly unsustainable” as new regulations near, margins and volumes keep falling and the way companies pay for research changes, he said.
A return to cost cutting by European banks “will ultimately be deemed positive,” Tyce and Arjun Bowry wrote on Monday.
Credit Suisse fell 0.8 percent to 13.06 Swiss francs in Zurich on Friday.
--With assistance from Liezel Hill and Renee Bonorchis To contact the reporters on this story: Zainab Fattah in Dubai at firstname.lastname@example.org, Stefania Bianchi in Dubai at email@example.com, Dinesh Nair in London at firstname.lastname@example.org. To contact the editors responsible for this story: Aaron Kirchfeld at email@example.com, Dale Crofts at firstname.lastname@example.org, Alaa Shahine at email@example.com, Vernon Wessels, Jon Menon
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