Is Morgan Stanley(NYSE:MS) going in for large-scale pruning?
The investment bank is considering closing some of its brokerage offices, sacking support staff and asking branch managers to bring in revenues by doubling up as advisers to combat the recession, Reuters reported on Tuesday citing unidentified sources.
How Should This Layoff The MS’ Shares, Get Free Trend Analysis
"Morgan Stanley, which controls the Morgan Stanley Smith Barney venture owned jointly with Citigroup, last week reduced the number of regions to 12 from 16, eliminating four manager jobs. Only about eight months earlier the firm had consolidated its regional manager ranks from 19," the report said.
All these changes are geared towards cutting costs and squeezing more revenues from its existing employees. More such measures are expected to be announced in the forthcoming weeks, the report said.
It said that the bank is planning a 10 percent cut in its 120-branch complexes that house a group of branch offices in a city or region.
Morgan Stanley is eager to slash spending in the brokerage division after all of its nearly 17,000 brokers were transferred last month onto a common technology platform.
Redundant offices from Morgan Stanley's and Smith Barney's nationwide networks will be closed, and support jobs will be eliminated, said the report.
It was not immediately clear how many jobs are in jeopardy, although as many as 100 offices could be closed, Reuters quoted one of the sources as saying.
Get Latest Special Report on MS
Morgan Stanley has told investors its wealth management business, weighed down by expensive merger integration and a tough market environment, can deliver mid-teens pre-tax profit margins. The margin improved to 12 percent in the second quarter after dipping as low as 8 percent.
Shares of MS are now up 0.83% to $ 14.62.