Executives at NYSE Group and NASD say the consolidation of their regulatory operations are unlikely to impact the size of their staffs in the short term, although some reductions would occur through attrition.
The New York Times reported the size of the combined regulation staff would probably remain at current levels: Some 2,700 people work in regulation at NASD, while another 470 are involved in similar operations at the New York Stock Exchange. According to the Times, cost savings from combining the regulatory operations into a single organization will be seen from the brokers and dealers who are regulated, not the regulatory organization itself.
Earlier this week, NASD and NYSE Group signed a letter of intent to consolidate their member regulation operations into a single self-regulatory organization. The SRO will be the private sector regulator for all securities brokers and dealers doing business with the public in the U.S. The move, which is backed by the Securities and Exchange Commission, is intended to increase the efficiency and consistency of securities industry oversight and reduce regulatory costs by millions of dollars per year.
The new SRO, which has yet to be named , will operate from Washington, D.C., New York and 18 district offices around the country.