Report: Morgan Stanley Smith Barney Discussing Cuts to Brokerage BusinessPosted by in Blog on August 9, 2012
Morgan Stanley is talking about making even more substantial cuts to its Morgan Stanley Smith Barney brokerage business, Reuters reports. There has recently been internal discussion about making a 10% cut to the company’s 120 branch complexes. Just last week, the company cut its regions from 16 to 12, cutting out four managerial positions. At the end of last year, the company had 19 regions.
According to the Wall Street Journal, Doug Kentfield, Bill McMahon and Rick Skae, three top executives at Morgan Stanley Smith Barney, held conference calls talking with the remaining 12 division directors, reportedly giving them a heads-up that company consolidation, reassignments, and cuts were coming. August 17 was a date discussed for the changes to be revealed.
While there was reportedly no talk about cutting any of the 16,900 financial advisor positions, there could be some eliminations of support staff, compliance, and risk management roles within the branch complexes.
Morgan Stanley currently has 743 retail offices around the world, 16% fewer than in 2010. Morgan Stanley combined its brokerage division with Smith Barney in 2009. In addition, Morgan Stanley said in July that it was planning to reduce the overall company’s head count by 700 by the end of 2012.
Danny Sarch, a recruiter for Leitner Sarch Consultants, told the Journal that Morgan Stanley’s cost-cutting initiatives are known within the company as “Project August.”
Christine Jockle, a spokesperson for Morgan Stanley, declined to comment on the story.