Investec has confirmed plans to axe 210 jobs at its London office as it warned first-half profits could fall as much as 60 per cent due to the coronavirus pandemic.
The jobs cuts, which equate to about 13 per cent of its UK workforce, are part of an ongoing plan to ‘to simplify and focus the business’, Investec said.
The UK and South African broker and asset manager also said that it is unlikely to pay dividend to investors for the half-year, in line with guidance suggesting banks not to pay dividends during the crisis.
It expects adjusted operating profit for the six months to the end of September to come in between 50 to 60 per cent lower than in the same period last year.
And said this was down to a ‘challenging economic backdrop’ due to Covid, which caused market volatility and economic activity to shrink.
Performance was also impacted by lower average interest rates, reduced client activity and a 22 per cent depreciation of the rand against the pound.
Fani Titi, chief executive of Investec, said: ‘Severe GDP contractions and volatile financial markets negatively impacted revenues.’
But he claimed the business proved ‘resilient’ during these months despite the impact of lockdowns in the first quarter before economies slowly started to reopen.
Assets under management increased by 14.1 per cent to £51.4billion in the five months to the end of August, while its net inflows were positive at £391million.
Investec shares fell 2.8 per cent to 134.55p on Friday.
Video: “Around 695,000 jobs lost since March as unemployment rises” (Evening Standard)