Bloomberg reports that Morgan Stanley and Citigroup are
among Wall Street firms preparing to eliminate jobs as first-half revenue
dropped for a third straight year. Headcount at Morgan Stanley will decline by about 700 in the
second half, bringing total 2012 staff reductions to 4,000, CFO Ruth Porat, 54,
said yesterday in an interview. Deutsche Bank, Europe’s biggest lender
by assets, is considering about 1,000 job cuts at its investment bank, while
Citigroup plans to chop about 350, people with knowledge of the decisions said
this week.
Trading and investment-banking revenue at the five largest
Wall Street firms fell 18 percent in the second quarter as deal and trading
volume dropped amid concern that Greece would leave the euro and the region’s
sovereign-debt crisis would spread to other nations including Spain. The
decline led to questions about whether banks could cut costs to improve
returns.
“All of these earnings that came out, none of them changed
the fundamental problem, which is Europe is in disarray and nobody is taking
risk,” Brad Hintz, a Sanford C. Bernstein & Co. analyst, said on Bloomberg
Television. “You have an environment where the Street can only tighten its
belt.”
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