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JPMorgan to cut 10 pct. of investment bank staff

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[November 21, 2008]  NEW YORK (AP) -- JPMorgan Chase & Co. is shedding about 10 percent of its investment bank staff in an effort to better weather the global economic slowdown.

DonutsThe New York-based banking giant is making cuts that are likely to be in line with its competitors Goldman Sachs Group Inc. and Morgan Stanley, said a person familiar with the matter on Thursday. The person spoke on condition of anonymity because the cuts have not been publicly announced.

JPMorgan's shares fell dropped $5.09, or 18 percent, to close at $23.38, and earlier reached $22.32 -- their lowest point since 2003.

As of the end of the third quarter, JPMorgan's investment bank employed about 31,000 people. That includes the roughly 7,000 employees added to the roster when the bank acquired Bear Stearns Cos. in March.

The cuts will be across all levels and all regions globally, the source told The Associated Press, and will be made through the end of the year.

JPMorgan is following in the footsteps of its competitors, who are slashing workers from their payrolls by the thousands amid market turmoil and the ongoing credit crunch.

Investment bank Goldman Sachs Group Inc. is cutting about 10 percent of its work force, and Morgan Stanley outlined plans last week to also cut 10 percent of staff in its institutional securities group -- its biggest business that covers everything from investment banking to stock trading. The layoffs follow a 10 percent cut made earlier this year in the same group. Morgan Stanley also plans to restructure its money management business by cutting 9 percent of its staff.

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Meanwhile, Citigroup Inc. announced plans earlier this week to shed about 53,000 more employees in the coming quarters. The New York-based bank, which has already reduced its assets by about 20 percent since the first quarter of the year, also plans to trim expenses by 19 percent in 2009 from third-quarter levels, to $50 billion.

JPMorgan has already been eliminating some jobs due to big profit hits from the financial crisis, and redundancies following the buyouts of Bear Stearns and failed thrift Washington Mutual Inc.

[Associated Press; By SARA LEPRO]

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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