Washington - Russia's VTB Group might downsize the staff of its London division as there is currently weak demand in a number of areas of the investment banking business, VTB head Andrei Kostin told reporters.
“Clearly there is a whole range of operations, primarily in the investment business, for which there is no demand today. If there are currently restrictions on access to capital, then probably such operations like IPOs, offerings of shares, bonds on the international market, this market is currently winding down to a significant degree, so we will be forced to make cuts,” Kostin said, commenting on the impact of sanctions against the state bank and other major Russian companies.
“We will, of course, downsize our businesses in London, Western Europe, but this will be negligible, only in those types of operations for which there is currently no demand. But on the whole we will preserve the core, because we believe that the situation will turn around in a year or two, and the people that are engaged in this constitute the foundation of our bank and they will be needed,” Kostin said.
However, he said some areas of VTB’s business will need more staff. Kostin said that “in a crisis you cut people who issue loans, but increase the number of people who collect bad debts, so there won’t be linear downsizing here.”
VTB Group was focusing on cutting costs this year even before the sanctions, and had announced a 15% reduction of payroll at its flagship bank and investment banking division. VTB also cut staff at its head office this year.
