ML cuts back in Jordan

Regional operations pared back as global cutbacks imposed.After the much-publicised decision to make 9,000 out of its 67,000 work force redundant, representative offices globally have been affected and the firm has taken a $2.2bn charge to cover cost-cutting measures.

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By  Massoud Derhally Published  February 21, 2002

|~||~||~|Merrill Lynch, the largest investment bank in America, is trimming the fat off its operations globally and the Middle East looks certain to fall under the surgeon’s blade. After the much-publicised decision to make 9,000 out of its 67,000 work force redundant, representative offices globally have been affected and the firm has taken a $2.2bn charge to cover cost-cutting measures.

The Middle East operations of the financial behemoth have already felt the pinch. “We have been reviewing our businesses globally in light of recent market conditions and have been making cost adjustments accordingly, including staff reductions. This has been part of a ongoing process worldwide,” a Merrill Lynch spokesman in London told Arabian Business. “But we have been very clear in saying that serving our clients across the Middle East remains a vital and important part of our firm’s global strategy.”

While none of Merrill Lynch’s existing executives in Bahrain, Beirut, Dubai or Jordan would confirm plans to slim down operations in the Middle East, it is common knowledge that the office in Jordan has been the latest victim of the investment house’s decision to downsize globally. The black building in central Amman which houses several companies, including the US investment house, no longer bears the Merrill Lynch logo.

According to a former Merrill Lynch employee in the region, the Jordan satellite office of Merrill Lynch Bahrain has made most of its staff redundant, with only 3 people left in the Amman office. According to a source who spoke on condition of anonymity, the office only managed $50 million in assets.

“We remain committed to Jordan and to serving our high net worth clients there. We intend to keep an office in Jordan and maintain our license to operate there,” insisted the Merrill Lynch spokesman in London. “Our clients will continue to receive the high quality products and services they have come to expect from our firm. We also remain committed to serving our clients in all of the Middle East, where we first opened an office 40 years ago in Beirut,” added the spokesman.

In Canada, Merrill Lynch’s entire operation has come to an abrupt halt, the South African asset management businesses have been sold off, and the online MLHSBC venture put on hold. In Japan, Merrill Lynch has trimmed down its presence from 28 offices to 8. By scaling down its retail operations in Japan, the US investment house is expected to concentrate on more profitable wholesale operations. It certainly is a troubling period for Wall Street’s ‘thundering herd’, whose profits were down by more than half this past October.
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