NatWest's trader job cuts send shiver through the market
NatWest is closing its US and European government bond desks and withdrawing from primary dealership programmes outside the UK. Bloomberg reported the move earlier today and said up to 10 jobs are at risk.
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A spokesperson for NatWest told us the bank is "simplifying" its structure and focusing its resources on areas of strongest customer growth and demand. These areas are deemed to be UK primary dealership, plus fixed income and markets financing, currencies and debt capital markets (DCM).
People on the desks being exited are still officially employed by NatWest. It's not clear who is at risk, but NatWest's euro government traders include the likes of Marc Moulin and Axel Didio in Paris, and Ryan Hearity and Adam Denning in London. Salespeople are thought to have been affected too.
NatWest's reason for closing the desks right now isn't clear. It has been a difficult few weeks in macro trading. Rokos made money in September, but many hedge funds did not. It's not clear whether banks have lost money too. NatWest may be the first bank to respond to the challenges.
Equally, though, traders at rival banks point to longer term harsh effects of electronification. European government bonds are traded through platforms like MTS Euronext and as volatility has risen, traders say costs can be prohibitively high for the more marginal players. "This could bode badly for the likes of HSBC, Santander, or even UBS," suggests one.
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