Morgan Stanley Said to Be Planning as Many as 1,800 Job Cuts

Business Materials 3 February 2009 00:19 (UTC +04:00)

Morgan Stanley plans to eliminate as many as 1,800 positions, or 4 percent of the workforce, a person familiar with the situation said, after posting its lowest annual profit in 13 years, Bloomberg reported.

Most of the reductions will come later this month in administration, technology and other so-called back-office areas, the person said. All of the positions will be in institutional securities and asset management, leaving global wealth management untouched, according to the person, who declined to be named because the decision hasn't been made public, Bloomberg reported.

Morgan Stanley, led by Chief Executive Officer John Mack, 64, is aiming to cut annual costs by $2 billion through a combination of job reductions and other savings. Revenue at New York-based Morgan Stanley, which converted to a bank holding company last year and took $10 billion from the U.S. Treasury, dropped 12 percent in 2008. The company employed 46,964 people at the end of November, according to a year-end regulatory filing.

Mark Lake, a spokesman for Morgan Stanley, declined to comment.

Banks and brokerages worldwide have cut more than 250,000 jobs since the middle of 2007 as credit losses and write-offs caused the worst financial crisis since the Great Depression. Morgan Stanley eliminated about 1,500 jobs in May and more than 4,000 in November. The firm reported losses in the fourth quarters of 2007 and 2008.

The Wall Stree Journal reported the job-cut plans on its Web site earlier today.