Samsung Securities Co. (016360), South Korea’s largest brokerage by market value, plans to close some of its overseas businesses, said three people with knowledge of the matter.
The company will shut equity sales and research operations in Hong Kong, said the people, who declined to be identified because the plan hasn’t been publicly announced. It wasn’t immediately clear how many jobs will be eliminated, the people said. Samsung Securities will also withdraw from Singapore, where it has five employees, one person said.
Samsung Securities and Asian rivals like Daiwa Securities Group Inc. (8601), which expanded in the region to compete with Goldman Sachs Group Inc. and Morgan Stanley, are cutting jobs after Europe’s credit crisis hurt trading income and advisory fees. Daiwa, Japan’s second-largest brokerage, said today it will eliminate 200 positions overseas.
South Korean brokerages posted a combined loss of $43.3 million in the six months ended September from their 93 overseas offices as Europe’s sovereign debt woes spurred market volatility, the country’s Financial Supervisory Service said in a Jan. 5 statement. The deficit widened from $17.3 million a year earlier, according to the regulator.
Samsung Securities opened its Hong Kong office in April 2001, according to a November earnings presentation posted on its website. With about 100 employees, the Hong Kong office is the company’s largest outside Korea, one of the people said.
New York, London
The company also has offices in New York, London, Shanghai and Tokyo with about 40 workers between them, according to the November presentation. Those offices won’t be affected by the restructuring, one person said.
Reuters reported earlier today that Samsung Securities would restructure overseas operations, citing people it didn’t identify. Samsung Securities Chief Executive Officer Kim Suk declined to comment when reached on his mobile phone today.
Shares of Samsung Securities rose 0.7 percent to close at 61,300 won in Seoul trading today. That compares with the benchmark Kospi (KOSPI) Index’s 0.8 percent gain.