Merrill Lynch Sheds 9,000 Jobs

Merrill Lynch, the nation's largest brokerage house, said it has eliminated 9,000 jobs. The company also announced a fourth quarter pre-tax charge of $2.2 billion.

Merrill said the total includes some fresh layoffs, but mostly job cuts made throughout the year. On Nov. 16 for example, Merrill said about 2,900 of its almost 66,000 workers had accepted a voluntary buyout package.

As the financial giant continues to feel the bite of the recession, it's moving to produce annual cost savings of $1.4 billion. A Merrill spokesman said more jobs cuts may take place in the first quarter, but "most of them are behind us."

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Merrill said it is eyeballing fourth quarter earnings of 48 to 50 cents per share, excluding the charge. That's in line with the current forecast for earnings of 48 cents per share in a survey of analysts by Thomson Financial/First Cal

The financial services specialist said it plans to channel the cost savings into its bottom line. A portion will be reinvested in "priority growth initiatives."

CEO David Komansky said the cost cutting moves come after a "detailed review of all our businesses over the past three months, and our current market outlook."

Merrill will spend $500 million of the total $2.2 billion charge to close offices around the globe, plus $300 million on technology, including write-downs of tech assets. About $200 million of the charge comes from "business rationalization costs."

Merrill said fourth quarter net revenue will drop 8 percent below third-quarter levels amid lower debt trading revenue and reduced investment banking activity.

The brokerage giant also cited business disruption in the aftermath of the Sept. 11 terrorist attack. The company has moved back into its headquarters at World Financial Center in downtown Manhattan.

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