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Morgan Stanley to Shift 75 Shanghai Jobs to Cheaper Sites
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Morgan Stanley (MS - Free Report) is planning to relocate around 75 staff from its operations team in Shanghai to lower cost sites like India and Hong Kong with an aim to boost back-office efficiency. The news was first reported by Bloomberg.
According to people familiar with the matter, the company will transfer a third of the affected roles to Hong Kong and the rest to India. The shift will lead to a few job losses in China, which the company will compensate by hiring in India.
The Shanghai operations team provides back-office support to Morgan Stanley’s regional businesses. The company is planning to concentrate the team in India, which is its major offshore operations hub in Asia, by getting rid of the smaller center in China.
However, the transfer will neither result in a decline in headcount of the operations team in the region nor affect the bank’s technology and data-support group based in Shanghai. The decision, which was declared internally in March, is expected to be completed by the end of the year.
Per the Bloomberg report, the redeployment was confirmed by Xu Li, a Beijing-based spokeswoman for Morgan Stanley, who declined to comment further.
Morgan Stanley’s plan to move jobs first surfaced in the early part of this year, when a Reuters report mentioned that the company is looking to shift more operations to lower cost cities like Mumbai and Budapest as it seeks to cut costs.
Per the report, the bank's Chief Executive James Gorman said on a fourth-quarter analyst call with analysts, “We have too many employees based in high-cost centers doing work that can sensibly be done in lower cost centers.”
The investment bank announced an initiative to reduce up to $1 billion by 2017 by using technology and outsourcing jobs now in its New York headquarters and other higher cost cities. In addition, the company targets to increase the number of employees deployed by 10–15% by the end of 2017.
Further, the company launched a company-wide initiative called Project Streamline, which is designed to identify and implement significant infrastructure expense reductions by the end of 2017.
Several other big banks such as The Goldman Sachs Group, Inc. (GS - Free Report) and HSBC Holdings plc (HSBC - Free Report) are also transferring employees overseas to reduce costs to improve efficiency in the face of macroeconomic pressure and intensifying regulatory landscape.
While Goldman has been moving thousands of jobs to cheaper cities like Salt Lake City, Utah and Dallas over the last several years, HSBC recently announced relocation of information technology jobs from Sheffield, Tankersley and London to lower-cost countries like India, China and Poland by Apr 2017.
Currently, Morgan Stanley carries a Zacks Rank #3 (Hold). A better-ranked investment broker is Raymond James Financial, Inc. (RJF - Free Report) , which sports a Zacks Rank #1 (Strong Buy).
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Morgan Stanley to Shift 75 Shanghai Jobs to Cheaper Sites
Morgan Stanley (MS - Free Report) is planning to relocate around 75 staff from its operations team in Shanghai to lower cost sites like India and Hong Kong with an aim to boost back-office efficiency. The news was first reported by Bloomberg.
According to people familiar with the matter, the company will transfer a third of the affected roles to Hong Kong and the rest to India. The shift will lead to a few job losses in China, which the company will compensate by hiring in India.
The Shanghai operations team provides back-office support to Morgan Stanley’s regional businesses. The company is planning to concentrate the team in India, which is its major offshore operations hub in Asia, by getting rid of the smaller center in China.
However, the transfer will neither result in a decline in headcount of the operations team in the region nor affect the bank’s technology and data-support group based in Shanghai. The decision, which was declared internally in March, is expected to be completed by the end of the year.
Per the Bloomberg report, the redeployment was confirmed by Xu Li, a Beijing-based spokeswoman for Morgan Stanley, who declined to comment further.
Morgan Stanley’s plan to move jobs first surfaced in the early part of this year, when a Reuters report mentioned that the company is looking to shift more operations to lower cost cities like Mumbai and Budapest as it seeks to cut costs.
Per the report, the bank's Chief Executive James Gorman said on a fourth-quarter analyst call with analysts, “We have too many employees based in high-cost centers doing work that can sensibly be done in lower cost centers.”
The investment bank announced an initiative to reduce up to $1 billion by 2017 by using technology and outsourcing jobs now in its New York headquarters and other higher cost cities. In addition, the company targets to increase the number of employees deployed by 10–15% by the end of 2017.
Further, the company launched a company-wide initiative called Project Streamline, which is designed to identify and implement significant infrastructure expense reductions by the end of 2017.
Several other big banks such as The Goldman Sachs Group, Inc. (GS - Free Report) and HSBC Holdings plc (HSBC - Free Report) are also transferring employees overseas to reduce costs to improve efficiency in the face of macroeconomic pressure and intensifying regulatory landscape.
While Goldman has been moving thousands of jobs to cheaper cities like Salt Lake City, Utah and Dallas over the last several years, HSBC recently announced relocation of information technology jobs from Sheffield, Tankersley and London to lower-cost countries like India, China and Poland by Apr 2017.
Currently, Morgan Stanley carries a Zacks Rank #3 (Hold). A better-ranked investment broker is Raymond James Financial, Inc. (RJF - Free Report) , which sports a Zacks Rank #1 (Strong Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>