Magazine article American Banker

B of A and Schwab Are Scaling Back British Operations

Magazine article American Banker

B of A and Schwab Are Scaling Back British Operations

Article excerpt

Bank of America Corp. and Charles Schwab Corp. announced plans Wednesday to pull back their respective operations in Britain.

The companies said the bear market has forced them to curb their ambitions abroad.

Bank of America and Schwab said they would continue to serve their U.S.-focused customers in Britain but would stop competing with local financial companies in certain products and services.

B of A said it will fire an unspecified number of the 110 employees in its equities operation in London, where its European operations are based. The job cuts will be in sales, trading, and research, a spokeswoman said.

Because the market has made it hard to be a leader in the equities business, she said, the Charlotte company will focus on equity derivatives and equity financing, where it believes it has a competitive edge.

It will still invest in its U.S. cash equities and derivatives units in London and will expand its United States-based research coverage of large European companies, the spokeswoman said. Bank of America, which employs about 2,500 people in Europe, established its London presence two-and-a-half years ago.

Charles Schwab teamed up over two years ago with TD Waterhouse Group of New York to buy the Scottish market-making firm Aitken Campbell for $88 million. Aitken Campbell, which is based in Glasgow, makes markets in pound-sterling-listed securities.

On Wednesday the San Francisco brokerage said it would sell its half to the Toronto-Dominion Bank unit for an undisclosed sum. …

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