Global investment bank Lazard Ltd. LAZ-N is cutting back its Canadian financial advisory business, announcing job losses for a 12-person team in Toronto on Wednesday, according to three sources with knowledge of the decision.
The cuts will significantly reduce the ranks of Lazard’s investment bankers who advise on deals in Canada, the sources said, though the bank plans to maintain an asset management business in the country. Staff in Toronto were told of the decision on Wednesday, two sources said.
The Globe and Mail is not identifying the sources because they are not authorized to discuss the decision publicly.
Lazard spokesperson Judi Mackey declined to comment.
New York-based Lazard opened its Canadian office in 2016, and its advisory bankers in Toronto covered sectors that include retail, financial institutions, health care, energy, private equity, real estate and technology. The Canadian office is led by Timothy Loftsgard, who joined the company in 2017 after 18 years at Royal Bank of Canada, specializing in mining and metals.
Lazard is scaling back an already small staff in Canada as a number of the world’s most prominent investment banks are pulling back on Canadian coverage. And that trend looks likely to continue with the future of Credit Suisse in Canada up in the air after the Swiss bank’s forced merger with rival UBS Group.
Once the deal closes, UBS is expected to downsize Credit Suisse’s investment bank and focus on wealth management. UBS and Deutsche Bank have also scaled back operations in Canada in recent years, and British-based HSBC Group is in the process of selling its Canadian operations to RBC.
Lazard hired established bankers with years of Canadian experience at larger domestic rivals, and part of its pitch to Canadian clients has been the global reach and connections it could offer to them. Its principal offices are in New York, London and Paris, backed by outposts throughout South America, Asia and the Middle East.
The bank was also well-connected enough in Canada to win government contracts to help set up a COVID-19 emergency support program for large employers in 2020.
Lazard had bulked up earlier in the frenzied markets of recent years, when low interest rates and a run-up in company valuations prompted a rush of deal-making. The company is also expected to make cuts in other offices in South America, one source said.
Lazard will release its first-quarter financial results on April 28.