Macquarie Group has flagged job cuts of around 10 per cent at its investment banking arm as it foreshadows a significant decline in full-year profit.
The company said its Macquarie Securities unit would make a negative contribution to net profit in fiscal 2012, which ends on March 31.
Macquarie Securities group head Stevan Vrcelj said the company was reviewing its portfolio, exiting some businesses and reducing costs.
"It will be more than 10 per cent head-count reduction in terms of the front end of the business," Vrcelj said. "And that also then feeds through into further head-count reductions in terms of the support structure for Securities."
Macquarie Group chief executive Nicholas Moore said the Macquarie Capital and Macquarie Securities businesses were experiencing difficult trading conditions in many markets and had been severely affected by the economic climate.
The global economic uncertainty had deepened and resulted in "substantially lower levels of client activity in many markets", he said.
"These market-facing businesses are really feeling the brunt of what's happening out there in the macro world."
Macquarie said yesterday that net profit for its current financial year across the group could fall about 25 per cent from the A$956 million achieved in the prior year, based on current market conditions. Should the result print in line with the bank's forecasts, net profit would come in at about A$717 million.
The updated guidance, and bleaker outlook from what Macquarie said in October, was below what many analysts had been expecting.