Bank of Montreal is laying off about 4 per cent of its capital markets positions globally, with about half of those roles in Canada
Bank of Montreal is cutting jobs in its capital markets division amid a year of slower trading and investment banking activity that dragged on earnings results.
After a torrid deals market in 2021 boosted earnings, activity has slumped across Canada’s largest lenders. Market volatility and economic uncertainty has dampened equity and debt issuance and dragged on investment banking revenue. Profits have sunk across the big banks, with BMO capital market’s net income falling 15 per cent in the second quarter from the same period a year earlier.
Lenders face a tougher operating environment as concerns of a recession weigh on loan demand and high inflation hikes costs. Expenses have jumped across the sector, putting pressure on top brass to trim spending. Salaries have been a major driver of higher costs after banks previously competed on wages and bonuses to scoop up and retain talent.
The banks had also bolstered their investment banking teams to keep up with the surge in demand for initial public offerings and merger and acquisition activity in 2021. Since the first quarter of 2021, BMO added about 400 employees to its capital markets team.
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