Morgan Stanley Eliminates About 1,500 Jobs in Year-End Cuts

(Bloomberg) -- Morgan Stanley is cutting about 1,500 jobs globally, including several managing directors, as part of a year-end efficiency push.

The cuts are skewed toward technology and operations divisions, but also include executives in sales, trading and research operations, people with knowledge of the matter said. The reductions amount to about 2% of the firm’s workforce, according to one of the people, who asked not to be identified because the information is private. The bank plans to take a charge in the range of $150 million to $200 million in its fourth-quarter results tied to the cost of the cuts, one person said.

Investment banks around the world have been trimming staff amid a multiyear slump in trading revenue and the expectation that more of the business will move to electronic platforms that require fewer humans. Citigroup Inc. and Deutsche Bank AG are among firms that have cut hundreds of trading jobs this year.

A spokesman at New York-based Morgan Stanley declined to comment.

The Wall Street firm has been in the spotlight for an investigation into its currency-options desks. The bank is probing whether traders improperly d the esoteric securities, concealing as much as $140 million in losses, Bloomberg reported last month. The cuts being carried out also include senior executives in its currency and bond desks in New York and London.

Chief Executive Officer James Gorman began slashing a quarter of the fixed-income workforce in 2015 and sold off large pieces of the commodities operation, concluding that new rules had permanently damaged prospects for the industry. Morgan Stanley, which reported a 21% increase in fixed-income trading revenue in the third quarter, generated $5 billion from the business last year.

The strategy has largely paid off, with Morgan Stanley gaining market share even while it reduced headcount and capital dedicated to the business. Analysts expect the bank to end 2019 with 10% more fixed-income trading revenue than in 2015, while rival Goldman Sachs Group Inc.’s total is seen dropping about 20% in the same period.

The firm’s stock is up about 25% this year, which would be its best performance since 2016.

©2019 Bloomberg L.P.