Charles Schwab to Close Brokerages
Dec. 07, 2001
SAN FRANCISCO (AP) _ Citing weak market conditions, Charles Schwab Corp. announced Friday it will close its brokerage businesses in Australia and Japan by the end of next month.
With the move, the San Francisco-based company will lay off all 87 employees in Australia and 40 workers in Japan, Schwab spokesman Glen Mathison said. Another 35 workers in Japan will be offered other jobs, Mathison said.
Schwab will absorb a pretax charge of $35 million in the fourth quarter to pay for the cutbacks.
The streamlining continues a string of cost-cutting moves made by Schwab this year to offset a sharp drop in customer trading. Since the beginning of the year, Schwab has trimmed its work force by about 25 percent, or more than 5,000 employees.
Schwab established brokerages in Australia and Japan last year. The company said the businesses weren't generating acceptable returns.
``We have done everything possible to cope with economic realities, but it seems that a meaningful turnaround in international markets will take much longer than previously thought,'' said Bill Atwell, executive vice president of Schwab International.
``In light of these factors, we made the decision to concentrate our efforts on those markets that we believe are more promising.''
Schwab will continue to run brokerages in Canada, the United Kingdom, Hong Kong, the Cayman Islands and Brazil.
Shares of Schwab fell 22 cents to close at $15.62 in trading Friday on the New York Stock Exchange.
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