UPDATE 1-BTG Pactual to cut 25 pct of Brazil staff, source says

miércoles 27 de enero de 2016 19:25 GYT

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By Tatiana Bautzer and Guillermo Parra-Bernal

SAO PAULO Jan 27 (Reuters) - Grupo BTG Pactual SA plans to dismiss up to 25 percent of Brazil-based staff, a source with direct knowledge of the matter said on Wednesday, as the embattled investment-banking firm downsizes operations following the November arrest of founder André Esteves.

According to the source, who requested anonymity because of the sensitivity of the issue, BTG Pactual has about 1,500 employees based in São Paulo, Rio de Janeiro and other Brazilian cities. A formal announcement is expected as early as Thursday, the source added.

The cuts are expected to hit all areas, including core activities such as investment banking, sales and trading and money management, the source added. BTG Pactual, excluding Switzerland-based private banking unit BSI Group Ltd, had about 3,300 employees at the end of December.

Some employees had already been warned about their dismissals earlier in the week, the source said.

São Paulo-based BTG Pactual declined to comment.

Latin America's largest independent investment bank, BTG Pactual began selling assets and dismantling trading operations after Esteves, the bank's former chief executive officer, was detained on Nov. 25 for allegedly obstructing a corruption probe in Brazil. Total assets fell 12 percent to 266.6 billion reais ($66 billion) at the end of December, from 303 billion reais in September.

The decision aims to match staff with the reduced size of BTG Pactual's balance sheet and business flow undertaken since Esteves' arrest. Sources have told Reuters that several assets, including pools of loans and stakes in dozens of companies, have been put up for sale to further cut the bank's balance sheet.   Continuación...