Citigroup to Cut 11,000 Jobs

Citigroup’s announcement that it will slash 11,000 jobs worldwide underscores its major contraction since nearly collapsing during the financial crisis and its continuing battle against high operating costs and persistently sluggish markets.

The cost-cutting fervor, including tens of thousands of Wall Street jobs slashed in recent years, is expected to continue at Citigroup and other banks as they combat sagging stock prices, lackluster revenue and new regulations that damp profits.

The cuts at Citigroup, many coming from its global consumer banking business, reflect a new emphasis on aiming at commercial banking jobs, some bank analysts said, rather than mainly eliminating investment banking positions.

With pressure mounting from shareholders, Citi has been trying to bolster returns, in part by working through a glut of bad loans and systematically dismantling some businesses. The job cuts amount to 4 percent of the work force and will bring the company’s head count down to about 250,000, down by a third since before the financial crisis in 2007.

HSBC Cut 30,000 Jobs in Last Two Years

HSBC has reduced its number of staff by almost 30,000 in the last two years and said more job cuts are likely across the bank to achieve its cost efficiency targets.

The bank had 266,700 staff at the end of September, down from 296,000 at the end of 2010 and down about 21,000 this year.

HSBC Chief Executive Stuart Gulliver said about 15,000 of the reduction were due to disposals by the bank and he expected more cuts before the end of 2013 to improve cost efficiency. "We are probably likely to see the headcount reduce further...in terms of the organic reduction, there's still some way to go," he told reporters on a conference call.

Gulliver said in May 2011 he would cut about 30,000 jobs as part of a restructuring plan.

Chicago: Trading firm Getco cuts 40 workers

Getco LLC, one of Chicago's largest trading firms, last week cut about 40 employees globally, including at least one top manager, as the firm realigns its focus and operations under a new CEO, according to sources familiar with the reduction.

Among those cut was managing director Edward Boyle, 49, who was based in Chicago and had business development duties across the firm, the sources said. He had joined Getco in late 2010 from NYSE Euronext, where he had overseen that exchange company's options business.

His departure follows the exit of several other senior managers in the past year, including David Babulak, who was also a managing director; Michael Rauchman, who was the company's chief technology officer; Brian Nigito, who was a top manger in New York; and Patrick Tray, who was a trading manager for the firm in Chicago.

A Getco spokeswoman declined to comment.

Getco, a top electronic market-maker at the New York Stock Exchange that is active in 50 markets around the world, is restructuring the firm and its focus in the wake of promoting Daniel Coleman as CEO in February.

Mr. Coleman, who was previously the company's global head of equities and client services, stepped up as the company's Chicago co-founders, Stephen Schuler and Dan Tierney, stepped back. The company has said previously that it has about 400 employees.

While Mr. Schuler and Mr. Tierney still own part of the company, they started answering to an outside investor in the firm when Greenwich, Connecticut-based General Atlantic took a minority stake in 2007.

Getco is not only a market maker on the exchanges, it also own stakes in several electronic ones, including the Chicago-based Eris Exchange, Bats Exchange and NYSE Liffe U.S.

Getco was founded in 1999 and has 400 employees.

AOL's Patch To Ax 20

AOL's Patch.com, the online local-news network whose high costs have made it a lightning rod for criticism of AOL's strategy, is laying off about 20 people as part of a broader restructuring.

Patch will consolidate its four geographic zones into three by integrating the South and East zones, allowing it cut some managers. No sites will be closed or merged and no local editors or ad managers will be affected. Patch, which has nearly 1,000 full-time journalists, announced the restructuring in a note to staff Tuesday morning.

"After implementing a more efficient field structure earlier this year, we have seen an impressive boost in both traffic and revenue," said Jon Brod, chief executive of Patch. "With an eye on our overarching business goals, streamlining our field management structure not only gives us additional operating leverage, but also allows us to better serve our users and out communities. This is the next step in Patch's strategy to win."

The high costs of keeping Patch running has become the centerpiece of dissident investor Starboard Value LP's campaign against AOL Chief Executive Tim Armstrong's strategy for the Internet company. Armstrong has promised to cut costs at Patch this year and get it to profitability by next year.

After expanding its presence from 30 towns to more than 850 towns in the past two years, Patch's annual loss has soared to more than $100 million--more than twice AOL's operating profit in 2011.

Starboard, which is running a proxy contest to win several seats on AOL's board at next month's annual meeting, argues Patch should be closed, sold or put into a joint venture where someone else covers some of the costs. Armstrong isn't backing off.

"Patch continues to deliver on its original mission and is on the right path for success in 2012 and beyond," he said in a statement. "AOL is executing a bold turnaround and Patch addresses a large and exciting market for our shareholders."

The cuts are the latest move made by Armstrong pre-empting Starboard's criticisms. In April AOL struck a deal to sell a portfolio of patents to Microsoft Corp. for $1.1 billion, shortly after Starboard had highlighted the patents as an underutilized asset. AOL also decided to return to shareholders all the cash raised from the sale, as Starboard demanded, after initially saying it would only return part of the money.

This story first appeared on WSJ.com

Hewlett Packard Considers Cutting at Least 25,000 Jobs

Hewlett-Packard is considering cutting its workforce by 8 to 10 percent, or a minimum of 25,000 jobs, sources familiar with the matter told Reuters, as newly installed CEO Meg Whitman strives to return the storied Silicon Valley institution to growth. 

The job cuts, which could include retirements, are under discussion but have not yet been finalized, several people familiar with the situation told Reuters. Th e sources did not elaborate on a time frame or other details. 

HP, which employs more than 300,000 people across the globe, could announce the layoffs as soon as next week when it unveils quarterly results, said the sources, who asked to remain anonymous because the plan has not been made public. Analysts have been expecting job cuts in the wake of Whitman's plan to merge the company's personal computer and printer divisions.

Morgan Stanley in Baltimore

Morgan Stanley & Co. plans to cut 1,600 jobs in early 2012 but it’s unknown if the impact will reach Baltimore.

The investment bank is not providing a breakdown of where the job losses will occur. The cuts represent around 2 percent of Morgan Stanley’s work force.

“As we conduct our year-end performance management process and evaluate the right size of the franchise for 2012, we anticipate the elimination of approximately 1,600 positions across the firm globally impacting all job levels, to take place early in the first quarter of 2012.” Sandra Hernandez, a company spokeswoman, said in a statement.

Morgan Stanley (NYSE: MS) has a major facility at Harbor Point where workers support several of the company’s business units, including wealth management and global investment banking.
Morgan Stanley employed 508 people in Baltimore as of 2010, according to the Baltimore Development Corp.

Morgan Stanley to cut 1,600 jobs

(Reuters) - Morgan Stanley (MS) will cut 1,600 employees in the first quarter, the bank said on Thursday, as it trims costs in a difficult period for trading and banking revenue.

The job cuts will come across all staff levels and geographic areas, spokesman Mark Lake said, including investment banking, trading and back-office functions.

Morgan Stanley is one of the last big Wall Street banks to announce major job cuts as analysts have begun slashing fourth-quarter earnings estimates.

Other banks, including Goldman Sachs Group Inc (GS), JPMorgan Chase & Co (JPM), Bank of America Corp (BAC) and Citigroup Inc (C) have already outlined plans to cut thousands of jobs this year. Morgan Stanley had kept firings limited to several hundred underperforming financial advisers earlier in 2011, but is now extending the cuts to banking and trading.

The cuts represent less than 2 percent of Morgan Stanley's workforce at September 30 and come as the European debt crisis continues to add stress to the markets.

Trading and dealmaking volumes have been hurt by volatile markets. At the same time, the value of securities banks hold for investments, clients or market-making purposes have declined, further hitting revenue and earnings.

Morgan Stanley is likely to report a loss in the fourth quarter, according to analyst reports this week, due to a special $1.2 billion charge the bank announced this week, related to a settlement with the bond insurer MBIA Inc (MBI).

Even excluding that charge, Morgan Stanley will earn just 15 cents per share for the fourth quarter, Atlantic Equities analyst Richard Staite predicted in a report on Thursday. That compares with 41 cents per share in the year-ago period.