Weakness in the gold price is continuing to cause more layoffs: in mining towns, at mining firms and on Bay Street.
Weakness in the gold market is continuing to cause more layoffs: in mining towns, at mining firms and on Bay Street. Stifel Financial Corp, St. Louis-based securities firm, has started to shutter its Canadian offices in Toronto and Calgary due to a slump gold and minerals.
“Both the Toronto and Calgary offices are closing beginning today [Friday, 23 August], but there will be a transition place kept in place until the end of the year,” Stifel spokesperson Sarah Anderson told Wealth Professional.
Around 70 staff are being effected, she said. Stifel is working with the Investment Industry Regulatory Organization of Canada (IIROC) to discontinue its business operations.
With weakness in gold and mineral markets, the Canadian operation was not contributing enough to Stifel Financial Corp's revenues, Anderson said. “You can see that represented in the revenues that Stifel Financial Canada represented out of the amount of total revenues.”
Last year, Stifel Nicolaus Canada generated net revenue of $18.8 million, or 1.2% of Stifel Financial's consolidated net revenue, according to the company's regulatory filing Thursday. Stifel's Canadian operations produced $4.2 million in net revenue in the second quarter, up 9.9% from the same period a year earlier. Parent Stifel Financial Corp reported second-quarter net revenue of $498.7 million, up 33% year on year.
Gold has fallen from $1790/oz in early October 2012 to below $1,200 in late June. It is now trading at around $1,396.
Anderson said that Stifel Nicolaus‘ Canadian trades would be done from through the US and through alternative avenues.