Morgan Stanley is eliminating 1,000 jobs as it scales back its residential mortgage operations in the U.S. and closes operations in the U.K., Reuters reports, citing Morgan Stanley information. More than 100 other mortgage lenders have cut jobs in the last year as the housing crisis worsens.
The New York-based company will continue serving mortgages in the U.S. through the Saxon Mortgage Services Inc. platform, while its Morgan Stanley Credit Corp. will continue to offer residential mortgages to brokerage clients.
Zurich, Switzerland-based UBS AG also confirmed a fourth-quarter net loss of $11.23 billion, due to heavy losses on mortgage securities in the U.S. The bank also posted its first net loss in 10 years, The Wall Street Journal reports.
UBS currently has $27.59 billion in securities linked to subprime mortgages, down from $38.77 billion in September. Several top executives have been let go, including Chief Executive Officer Peter Wuffli, Chief Financial Officer Clive Standish and Huw Jenkins, head of investment banking.
Sources on Wall Street say that Ambac has hired Gartner Group to reengineer its operations, starting with its IT group. Meanwhile, Warren Buffett is moving large positions into reinsurance and out of collateralized debt obligations, to the surprise of some of those in the credit rating business.