Layoffs across Wall Street started in June and have continued through the summer.
Morgan Stanley already begun reducing headcount in its brokerage.
But it looks like things are about to get much worse.
“The firm is “running layoff scenarios into several thousand folks,” said one person with direct knowledge of the matter” to Charlie Gasparino at Fox Business News.
In June, Morgan Stanley’s CFO, Ruth Porat, hinted there would be significant cuts coming to the bank’s Smith Barney brokerage unit. As with layoffs that occured in the first quarter, potential job cuts would come by “pruning weak performers,” a bank spokesman said.
Originally, cuts aimed to reduce the headcount of the Smith Barney unit from 18,500 to 17,500.
Gasparino said the “firm would not deny that Morgan is drawing up plans for a sweeping new round of layoffs if business conditions don’t improve.” Such layoffs would include brokers, traders and possibly staff in the investment bank.
“We are constantly evaluating the market conditions to ensure we are right sized. We have said we currently have no plans for a major (reduction in workforce) other then 300 or so underperforming FAs, and that remains the case,” a spokeswoman said.