Monday’s Headlines: Behind the Exodus at MSSB

Layoffs and defections have infected Morgan Stanley Smith Barney in recent years, and the trend is not abating soon. An Investment News article announced that as MSSB moves toward dropping the “SB” and folding Smith Barney into Morgan Stanley, management is planning yet another round of layoffs. We recently reported that following a bleak earnings report, the firm plans to slash another 800 jobs, bringing the total since the end of last year to 4,000. The story seeks to answer the “why":

The trade press continues to report on large defections from Morgan Stanley Smith Barney LLC. This diaspora may be a result of the culture change or possibly a decrease in service levels to the adviser. Or maybe senior managers have failed to show an understanding of what their own advisers do every day.

Examples include technology that analyzes fees and commissions, which is handy yet inflexible in helping advisors land new clients.

Other News:

Banks created 10,000 subsidiaries in the past 22 years to pay lower taxes and escape regulation. [Bloomberg]

Blackstone and Bain are bidding for RBS’s Direct Line unit. [Businessweek]

Singapore’s Fraser and Neave hired Goldman to advise on Heineken’s $6 billion bid for Asia Pacific Breweries. [Reuters]

China’s Citic Securities is set to buy Credit Agricole’s Hong Kong brokerage for $1.25 billion. [Financial Times]

FactorShares, a provider of leveraged ETFs, was bought by Esposito Private Equity. [Financial Times]

Swiss private bank Julius Baer partnered with Bank of China to refer clients and cross-market. [Reuters]

KKR will offer retail funds to pursue debt investments. [Investment News]

AIG most likely buyer of Woodbury Financial. [Investment News]