Job cuts feared as Bankers Trust downgraded after £78m loss
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.BY JOHN EISENHAMMER
Financial Editor
Bankers Trust shares fell sharply in New York yesterday on reports of large job cuts, big losses and a downgrading by credit rating agencies. Several broking houses put Bankers Trust on sell, following the American investment bank's announcement on Friday that it expects to post a $125m (£78m) loss for the first quarter of 1995.
IBCA, the bank credit rating agency, said yesterday it had placed its rating for Bankers Trust on RatingWatch, with negative implications.
"Bankers Trust has demonstrated skill in managing risk and an unusual ability to adapt to changing markets but those strengths are being tested by the extremely difficult market conditions," IBCA said.
IBCA said the poor performance reflected the extent to which the bank has been hit by the negative publicity from losses at big companies like Procter and Gamble. Standard & Poors also revised its ratings outlook on Bankers Trust to negative from stable.
Bankers Trust has cut about 60 jobs in its derivatives business in recent months and is reportedly planning to cut a further 10 per cent of its 15,000 staff. Insiders reported that executives had been working all weekend to sort out problems at the bank. Bankers Trust stock fell sharply in opening trading yesterday in New York, down by more than $7 to $54.
Michael Metz, an investment strategist at Oppenheimer and Co, said both Bankers Trust and JP Morgan, whose shares were also hit yesterday, were victims of the growing concern over derivatives. "Morgan and Bankers Trust are major factors in derivatives. The big question is how systemic it is."
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments