UPDATE 1-Danske axes 150 investment banking roles in bid to cut costs

Thu May 29, 2014 12:45pm EDT

Related Topics

* Danske to make 75 redundancies, cut further 75 roles

* Weak margins, regulation take toll on banks

* Fixed income, currencies, capital markets hit (Adds quote, background)

By John Geddie

LONDON, May 29 (Reuters) - Denmark's biggest listed lender Danske Bank will cut 150 positions from the corporate and institutions division of its investment bank in a bid to reduce costs, a spokesperson for the bank said on Thursday.

Struggling in the face of increased regulation since the financial crisis, weak margins and the move towards machine-driven electronic trading, banks have been cutting back staffing on trading floors across major financial centres.

Danske said its latest cuts are part of a pledge made by Chief Executive Thomas Borgen last year to make a billion crowns of cost savings, and come on top of thousands of job cuts announced in recent years.

"A process has started of letting around 75 people go across its geographical markets," the Danske Bank spokesperson said.

"In addition to this, we are reducing a similar number of positions by relocating employees within the bank, voluntary exits and not re-staffing open positions."

The cuts will impact the bank's fixed income, currencies and commodities (FICC), capital markets and transaction banking products.

Danske, which has suffered from single-digit profitability relative to its Swedish peers, is already starting to reap rewards from its cost-cutting initiatives.

The bank raised its full-year profit guidance earlier this month after it posted its highest quarterly earnings since the global financial crisis.

Nordea, the Nordic region's biggest bank and one of Danske Bank's biggest competitors, has also been cutting staff in past years and is expected to continue. It announced in January it was aiming to create 900 million euros ($1.24 billion) in cost savings from 2013 to 2015. (Addtional reporting by Mia Shanley in Stockholm, Editing by Angus MacSwan)

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