In times of a slowdown it is normal practice to cut jobs and financial services companies are notorious for resorting to this strategy of cutting costs and keep their expenses low.
This recession has dragged on for a long time and some companies are resorting to second and third round of job cuts.
Swiss banks UBS (NYSE:UBS) and Credit Suisse Group (NYSE:CS) are both set to announce job cuts that could total 7,000, according to a report in the Der Sonntag newspaper.
According to the report in the paper, UBS is set to cut about 3000 to 5000 jobs as part of its measures to save on costs while Credit Suisse may announce jobs cuts ranging between 1000 and 2000 employees.
Banks are going through tough times as credit growth has slowed and equities trading volumes are dwindling. For them the easiest thing to cut back is employee costs. The Swiss media has been speculating about job cuts and these two banks for a while now.
UBS is scheduled to announce its third quarter earnings on October 30 and is expected also expected to reveal the job lay-offs then.
A Reuters report said that UBS had said that a final decision on its on-going business review had not yet been taken.
Whether Credit Suisse will really go ahead with the rumoured job cuts is debatable since there are conflicting reports that the bank might hold off announcing the staff reductions for a while.
Last quarter CS had announced an extra $1.1 billion costs cuts while it had wanted to shed 3,500 positions. The bank had already reduced its employee numbers by 1,500 from the end of 2011 to 48,200 at the end of June.