KPMG slashes bonuses again as dealmaking fees dry up
KPMG has slashed bonuses for its UK deals team again today in the latest sign of strains facing the firm after a drop off in dealmaking this year, City PM has learned.
The Big four firm already cut payouts for the deals division by around half in May but today informed the team bonuses would be slashed further, a source told City A.M.
Staff in the division were told in an email today bonuses would be “lower” but were not given a figure that it would be reduced by, the source said.
Earlier in the year, KPMG told its staff that annual discretionary bonuses will be lower than in years of growth.
A KPMG UK spokesperson, said: “A challenging economic environment has driven a softening in a number of markets, including Deal Advisory.”
The move comes after KPMG slashed the bonus pool of its wider UK workforce and reined in commission for salespeople in earlier in the year as profits faltered amid a slowdown in the deals fees, City PM revealed in May.
KPMG and its main rivals EY, PwC and Deloitte have been hammered by a slump in fees after a major slowdown in mergers and acquisitions. In the UK, deals have cratered to a 14-year low this year as rising interest rates and volatile prices scuppered a predicted wave of takeovers.
KPMG is also planning to cut about around 100 jobs in its deal advisory business in the UK and has restructured to more easily deploy employees to other areas of the business.
The firm merged its Canary Wharf-based consulting and deal advisory units but stressed the move was not linked to recent job cuts tied to the collapse in dealmaking, City PM revealed last month.
All of the big four have laid off staff to cope with the downturn this year, with PwC becoming the latest company to make the move last week.
The Big Four have now cumulatively put some 1,800 jobs on the chopping block this year. Deloitte has planned the most job cuts of the Big Four this year with plans for 800 layoffs.