New York: In a sign of the times, Morgan Stanley joined the legions of financial firms shedding jobs by announcing plans on Thursday to eliminate 1,600 jobs. The bank is also cutting 80 back-office positions in Singapore as part of measures to streamline its operations and offering relocations to India and Hungary.
The New York headquartered firm’s layoffs, which will begin early next year, amount to 2.6 percent of its global personnel estimated at about 62,000. “As we conduct our year-end performance management process and evaluate the right size of the franchise for 2012, we anticipate the elimination of approximately 1,600 positions across the firm globally impacting all job levels,” said a Morgan Stanley spokesperson.
The layoffs will come from throughout the financial company, including the investment banking and trading divisions, but are not expected to affect the company’s 17,000 financial advisers. Earlier this year, the firm fired 300 financial advisers. Barring extraordinary events, like a meltdown in Europe, Morgan Stanley is not planning further job cuts in 2012 beyond the 1,600 announced.
Morgan Stanley employees in India working on the investment banking, research and sales side may be hit by jobs cut, but the bank is also redeploying a number of Singapore-based back-office jobs to India.
The Wall Street Journal reported that Morgan Stanley is redeploying certain roles supporting its finance and operations divisions, including shifting product-control jobs to India, and some management-reporting roles to Hungary. These back-office jobs provide research and other support for Morgan Stanley’s global businesses.
“Singapore is getting more expensive partly due to a stronger currency. It’s getting close to Hong Kong in terms of costs, so it doesn’t make sense to keep those functions here,” a banker familiar with the situation told The Wall Street Journal.
Hong Kong is Morgan Stanley’s regional headquarters in the Asia Pacific region.
Banks worldwide have announced more than 2,00,000 lay-offs this year as investors question valuations and punish bank stocks. The sluggish economy has forced financial companies to lower headcount and the job cuts have started biting in India. Nomura Holdings, Japan’s largest brokerage, recently let go of nearly 2 percent of its Indian employees which included analysts, associates, vice presidents, executive directors and managing directors.
The Economic Times reported on Thursday that Japanese financial services firm Daiwa Securities is also in the process of retrenching in India. French bank BNP Paribas also laid-off nine employees in India from its domestic fixed income and investment banking divisions.