Morgan Stanley Contemplating Reduction of 7% of Jobs in Asia Investment Bank, Reports Insider
According to a reliable source, Morgan Stanley is reportedly considering a workforce reduction of around 7% in its Asia-Pacific investment banking division, which would amount to approximately 40 jobs being cut. The proposed cuts are expected to primarily affect the investment banking and capital markets operations in the region, excluding Japan. When contacted for comment, a spokesperson for Morgan Stanley (NYSE:MS) declined to provide any official statement on the matter.
The potential job cuts are part of a broader global downsizing initiative aimed at adjusting to market conditions and minimizing expenses, the source disclosed. Due to the confidential nature of the information, the individual chose to remain anonymous. Bloomberg News initially broke the news about the anticipated layoffs on Tuesday.
This move follows previous reports from Reuters on May 1, which revealed that the bank had plans to eliminate approximately 3,000 positions globally in the second quarter. These job cuts represent the second phase of downsizing within a span of six months. The decision to reduce the workforce was prompted by sluggish dealmaking and a challenging economic environment, as stated by a source at that time.
Morgan Stanley employed over 82,000 individuals as of the end of March, meaning that the elimination of 3,000 jobs would signify a workforce reduction of nearly 4%.
The global landscape of dealmaking has experienced a significant slowdown, with corporate buyout activity reaching its lowest point in a decade during the first quarter of 2023. In Asia, the total value of deals involving regional companies reached $176 billion in the same period, marking a 34% decline compared to the previous year and the lowest level observed since 2013, according to data from Refinitiv.
The capital markets activity across the Asia-Pacific region has also witnessed a sharp deceleration. Advisors indicate a bleak outlook for Hong Kong initial public offerings (IPOs) for the remainder of the year.