Mack’s plan, these people say, is to slash 10 percent of the firm’s workforce during 2008, though he is leaving his options open to cut more if business conditions don’t improve. "Hopefully this is it for 2008, but you never know," a Morgan executive told CNBC.CNBC also reported that Lehman Brothers (LEH) is set to add to the 4,900 it has already laid off as it looks to "right size" amid continuing market trouble. The news station did not specify the size of timing of the alleged cuts, citing a source close to the company. The cuts at both Lehman and Morgan Stanley come as JPMorgan Chase & Co. (JPM) digest the operations and personnel tied to the Bear Stearns (BSC) bailout. Sources have said JPMorgan is trimming existing staff as it preps for the arrival of Bear Stearns expats in the months ahead. Firms have been looking to snap up some of the sloughed-off talent pool, including bond-market giant PIMCO, which was reported by the Financial Times last week as actively reaching out to Wall Street's i-banks to let affected employees know about hiring interest and available positions at the world's biggest bond fund. Disclosure: The author held no positions in the publicly-traded firms mentioned in this story when it was originally published. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.
More Layoffs Ahead for Morgan Stanley, Lehman: Report
Morgan Stanley (MS) execs are planning another round of layoffs at the Wall Street firm, this time hitting 1,500 employees, according to a report Monday by CNBC. Citing senior sources inside the company, CNBC said that the cuts will span all business units. Morgan Stanley delivered better-than-expected earnings during the first quarter despite absorbing $2.3 billion in write-downs tied to mortgage and related assets; which makes the expected cuts somewhat of a surprise, according to various sources Housing Wire spoke with. "I suppose Mack meant that after the ninth inning, it's game over for at least some of his team," said one source, an MBS trader who asked not to be identified by name, referring to CEO John Mack's earlier remarks that the credit crunch was nearing its end. From CNBC: