Goldman cuts at least 25 Asia bankers as China deals swoon

GOLDMAN Sachs Group has started axing at least 25 investment bankers in Asia as a drought in dealmaking prompts cuts across sectors, people familiar with the matter said.

The cuts span its equity capital markets, health care and telecommunication, media and technology teams in Asia, the people said, asking not to be identified because the matter is confidential. The majority of the reductions are affecting junior level bankers involved in deals in Greater China, the people said.

“Every year globally we conduct a strategic assessment of our resources and calibrate headcount to the current operating environment,” a spokesman said in an email, without commenting on the extent of cuts. “We continue to remain flexible while executing against our strategic growth priorities.”

The Wall Street firm is planning its biggest round of jobs cuts since the start of the pandemic, seeking to eliminate several hundred roles starting this month, people with knowledge of the matter said earlier. While the total number is lower than some previous rounds, the reductions are a resumption of an annual culling cycle that the New York-based bank largely paused during the Covid outbreak.

The Asia reductions come after Goldman went on an unprecedented hiring spree in mainland China and Hong Kong last year as the world’s second-biggest economy opened its financial market fully to foreign brokerages and asset managers. The cuts in investment banking are deeper than for the securities division after dealmaking in China ground to a near halt this year as Covid lockdowns and rising political tension hinder the economy, 1 of the people said.

Global banks in Asia are under pressure to reduce costs this year after Asia-Pacific equity offerings plunged by around half to about US$175 billion this year, Bloomberg data shows. Credit Susise Group cut more than 2 dozen front line roles at its investment bank in July, while UBS Group also let go half a dozen China-focused bankers. BLOOMBERG