Wednesday’s Headlines: Morgan Stanley Could Close Offices
More cuts are to come at Morgan Stanley, according to The Telegraph and other media outlets. The newspaper cited recruiters who foresee more job losses at the bank following last week’s reduction in regions from 16 to 12, and the elimination of four managers. Future cuts include 10 percent reduction in its regional “complexes,” and as many as 100 of its 740 offices may be closed.
Last month, 17,000 brokers were transferred to a common tech platform, and offices are being closed on the merger of the Morgan Stanley and Smith Barney operations.
The Wall Street Journal reports that it isn’t clear how many job cuts could result from the announcement, though some brokers and branch managers expect staff in jeopardy to include employees such as risk officers, service managers and compliance officers – roles sometimes held by multiple employees at one complex.
Morgan Stanley said last month that it expects to lay off 700 employees throughout the securities firm by the end of the year amid turbulent markets and lackluster client activity.
But the latest round of expense cuts at the brokerage underscores the pressure the wealth management unit, led by President Gregory Fleming, is under to reach a mid-teens pretax profit margin by the middle of next year and 20 percent in the future. The margin, which was 12 percent in the second quarter, is a key metric for investors focusing on performance goals stated by Morgan Stanley Chairman and Chief Executive James Gorman a few years ago.
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Opinion: Barclays debacle signals need for Wall Street culture overhaul. [Businessweek]
Scandal at Barclays, HSBC and Standard Chartered is tarnishing the British banking industry’s reputation. [WSJ]
iPad apps for every financial advisor. [Investment News]
Mistakes to avoid for a career as a financial advisor. [Investment News]
FINRA fined Wedbush Securities and suspended its president. [On Wall Street]