Morgan Stanley joins bank slashing with 1,600 jobs to go
MORGAN Stanley became the latest investment bank to announce another round of job cuts yesterday, saying that it will slash 1,600 employees by the end of March next year.
The bank said the losses would be across all geographies, levels of hierarchy and front- and back-office roles.
But City A.M. understands that the front-office cuts are likely to fall most heavily on fixed income, structured credit and securitisation – all areas penalised most heavily by new Basel III capital rules.
By contrast, its flow business is understood to have held up fairly well and equities is likely to escape relatively unscathed.
The cuts are most likely to be decided in February after a “performance management exercise”, said a source familiar with the situation. In other words, staff will be given a review of their performance and a chance to improve before they are laid off.
The bank joins its rivals in cutting thousands of jobs this year, with Goldman Sachs, Barclays Capital and JP Morgan Chase all having announced lay-offs.
However, the likelihood of few cuts in equities makes Morgan Stanley unusual among its peers.