The Hong Kong office of Nomura fired almost 30 per cent of its research team yesterday as an uncertain global economic outlook forces the Japanese brokerage to cut costs.
According to people who asked not to be named, Nomura sacked 15 analysts out of a total of about 50. Globally, the company has 720 researchers, according to its website.
The people said more lay-offs were expected next week in Nomura's investment banking department in Hong Kong.
Last week, the company said it would slash US$1 billion in costs by March next year to repair its balance sheet.
Some bankers said Nomura might have to cut at least 1,000 staff globally to meet the cost-saving target.
The latest lay-offs in Hong Kong follow the firing of several equities sales staff in the city last week.
A Nomura spokesman declined to confirm the number of research analysts the bank has in Hong Kong, and would only say the number of jobs affected yesterday is less than 30 per cent.
While Hong Kong appears to have weathered the downturn caused by the euro-zone sovereign debt crisis better than Europe and the US, the region is starting to feel the pinch, with junior staff being laid off at several investment banks recently as well as some highly paid bankers.
"If pressure continues to mount, more banks will look at their business and pull back from Hong Kong and restrict operations," said Paul McSheaffrey, a China partner with global accounting firm KPMG.
Although the number of authorised financial institutions increased to 198 last year from 193 in 2010, international banks have been scaling back as profitability continues to weaken.
KPMG said in a recent report that over the past year it had become more common for banks to outsource various back-office functions to reduce costs.
Meanwhile, headcounts were cut to align with the revenue streams, it said.
Last month, Spain's BBVA laid off about 50 employees in Hong Kong. Most of them were in equities-related sales and trade, including some in the sophisticated structured-products team.
Those lay-offs were followed last week by Deutsche Bank, which axed about 80 jobs in its Hong Kong and Tokyo offices - mostly sales and trading staff and some equities-related bankers and research analysts.
Daiwa Securities, which cut about 100 jobs in Hong Kong early this year, also trimmed more staff recently, including several senior executives. The previous staff cuts involved mostly relatively junior positions.
Additional reporting by Lulu Chen