Industry overhaul sees Tullett axe jobs

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Interdealer broker Tullett Prebon is cutting around 210 jobs after revenues fell 15 per cent in the first half, as the company tries to cut costs to cope with big changes in its industry where regulators are cracking down on risk.

Tullett, whose brokers match buyers and sellers of currencies, bonds and swaps, is cutting around 160 front office and 50 back office roles from its 2,328-strong workforce. Its annual fixed costs will be reduced by £40m, rather than the £20m it anticipated earlier.

It is also paying its brokers less. Compensation as a percentage of broking revenue was 56.7 per cent in the first half, 1.5 percentage points lower than a year ago, the company said yesterday.

Like rival ICAP, which said earlier this month it was shrinking its voice broking division, Tullett has stepped up its cost-cutting because of the tough environment.

Revenues have declined as investment banks pull back from risky trading activities to comply with new rules brought in after the financial crisis, while ultra-low interest rates have further reduced banks’ scope to trade.

A regulatory push to force more derivatives trading on to electronic platforms in a bid to make the market more open and safer has also hit trading volumes.

Tullett earlier reported first half revenue was £360.3m, 15 per cent lower than a year earlier. Underlying profit before tax was down more than 30 per cent to £43.2m.