Hurt by volatile markets and enhanced regulations, banks cutting jobs to increase profit margins  The worldwide finance sector is still reeling from the effects of the recession, which eroded equity and prompted the sovereign debt crisis currently plaguing European nations. Large banks are cutting workers as they work to achieve business cost reductions, with some of the world's biggest financial institutions announcing a fresh wave of layoffs.

Wall Street continues to draw the ire of its critics, as protests throughout the U.S. and across the world increasingly target such institutions for the central role they played in the 2008 financial meltdown. Still, banks are struggling to offset a fall in revenue prompted by newly enacted regulations, and they are laying off workers as they endeavor to return to pre-recession profit margins.

The New York Times reports Citigroup - a bank that had more than 400,000 employees only five years ago - plans to reduce its payroll by an additional 3,000 workers. That figure represents roughly 1 percent of its current global workforce, which has been reduced to only 295,000 people as the bank suffered under the weight of bad investments it made on the U.S. housing market.

French banking giant BNP Paribas is also significantly reducing its worldwide payroll, announcing it would cut 7 percent of its staff, or about 1,400 jobs. Four hundred of the jobs that BNP Paribas plans to cut will affect French workers. An additional 1,000 workers will be let go at the company's international locations.

Citigroup has not announced a final figure of how many workers will lose their jobs, but it could exceed the 3,000 figure, according to The Times. The timing of the layoffs is also unknown: Citigroup has informed some workers, but executives are still mulling what departments should be downsized - and to what extent.

Shareholders have increasingly lobbied banks to increase profitability, as many are accustomed to the substantial margins logged both before and in the immediate wake of the financial crisis. Goldman Sachs and JPMorgan Chase, for example, reported robust earnings in 2010, as the financial giants profited from global economic uncertainty.

However, banks are currently facing hefty regulations that have eroded former revenue channels. Bank of America reneged on plans to begin charging customers a $5 monthly debit card fee, but company executives said the Dodd-Frank financial overhaul bill has eaten into revenue. The lower debit card fees banks are now allowed to charge merchants will result in more than $6 billion in lost revenue, according to analysts.

In total, banks plan to cut more than 120,000 jobs this year, according to Reuters. Though they are reducing their workforces in varying ways, nearly all banks assert the stringent financial regulations and volatile trading environment have hurt earnings over the past six months, magnifying the need for business cost reductions.

Italy's UniCredit will give more than 6,150 workers pink slips over the coming months. The bank has been especially affected by the continued sovereign debt woes plaguing the continent. Yields on Italian-issued debt have risen above the critical 7 percent threshold over the past week, the same level that prompted governments in Spain, Ireland and Greece to seek bailouts from the European Union.

Banks throughout the world are implementing employee reduction plans as they seek to return to profitability, with many major players announcing measures that will gradually lower workforce figures over the next three to four years.
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