LONDON: Lazard, the largest non-bank merger advisor, has been given five weeks to find a buyer for all or parts of Royal Bank of Scotland Group's (RBS) equities and advisory operations before managers start firing employees, according to three executives at the bank.
RBS, the UK's largest state-owned lender, last week said it will sell or close its unprofitable cash equities, mergers advisory and equity capital markets units.
The 3,500 affected employees won't be put on redundancy notice until RBS concludes it can't find a home for them elsewhere, said two of the executives, who declined to be identified.
The decision needs to be made before the bank reports full-year earnings on February 23 because clients are threatening to pull their business and employees are becoming increasingly de-motivated, they said.
"The more time goes by, the more commissions slip away to competitors and the higher the likelihood that the big-name bankers walk away," said Arun Melmane, bank analyst at Investec in London.
"The value of the business will ebb away so they need a sale to be quick, which obviously suggests a discount."
RBS plans to cut the units after volatile markets and increasing regulation rendered it impossible to generate returns that surpassed their cost of equity.
The restructured investment bank will focus on fixed income, foreign exchange, debt financing, transaction services and risk management, the Edinburgh-based company said in a statement on January 12.
indiatimes.com
RBS, the UK's largest state-owned lender, last week said it will sell or close its unprofitable cash equities, mergers advisory and equity capital markets units.
The 3,500 affected employees won't be put on redundancy notice until RBS concludes it can't find a home for them elsewhere, said two of the executives, who declined to be identified.
The decision needs to be made before the bank reports full-year earnings on February 23 because clients are threatening to pull their business and employees are becoming increasingly de-motivated, they said.
"The more time goes by, the more commissions slip away to competitors and the higher the likelihood that the big-name bankers walk away," said Arun Melmane, bank analyst at Investec in London.
"The value of the business will ebb away so they need a sale to be quick, which obviously suggests a discount."
RBS plans to cut the units after volatile markets and increasing regulation rendered it impossible to generate returns that surpassed their cost of equity.
The restructured investment bank will focus on fixed income, foreign exchange, debt financing, transaction services and risk management, the Edinburgh-based company said in a statement on January 12.
indiatimes.com
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