June 20 (Bloomberg) -- Morgan Stanley will exit power and natural gas trading in Bulgaria, the Czech Republic and Poland as it scales back in commodities, a person with direct knowledge of the matter said.
The bank, based in New York, will leave markets in eastern Europe where it doesn’t have a competitive advantage, said the person, who asked not to be identified because the plans aren't public. It will continue to trade western European power and carbon permits, according to the person. Charles Rankin, the bank’s London-based head of European commodities, declined to comment on job cuts today when reached by phone.
“We will reduce our footprint in EU power and gas by exiting some Eastern European markets,” the bank said today in a memo to employees from Colin Bryce and Simon Greenshields, co-heads of the unit, obtained by Bloomberg News. “The commodities revenue pool available to firms in our sector has fallen by almost 50 percent from the peak years of 2007 to 2009.”
Morgan Stanley is cutting jobs in its commodities business, one of the three biggest on Wall Street, after Chief Executive Officer James Gorman said last week the unit’s revenue in the past two quarters was among its worst in 18 years. The latest round of commodity redundancies will eliminate 30 to 35 jobs, or about 10 percent of its workforce, the person said.
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