Less than a week after Moody's downgraded its credit rating French bank Credit Agricole announced on Wednesday it will be cutting some 2,350 jobs in the coming months as it continues to try to cut costs and streamline operations in the midst of the European sovereign debt crisis. According to a source familiar with the plan, 1,750 of the job cuts will occur at the bank's corporate and investment bank, which employs roughly 13,000, with the other 600 will be shed from its factoring and consumer finance units.
Credit Agricole's downsizing follows similar house-cleaning measures taken by BNP Paribas and Societe Generale, the nation's other two big banks. Both have announced significant cuts over the last few months, mainly in investment banking divisions, in attempts to reduce debt and wean themselves off of funding markets that have essentially been frozen by the effects of the debt crisis.
The eurozone debt crisis has been fueling volatility in world markets for over six months, and banks around the world have been particularly hard hit as investors are concerned about their exposure to sovereign debt of struggling European nations like Greece, Portugal, Spain, Italy, and even France. In all, the global financial sector has slashed more than 120,000 jobs this year, and insiders warn that the total may exceed that seen at the height of the financial crisis in 2008 as banks continue to cut payroll into next year.