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Manufacturers Hanover to Lay Off 2,500 Workers

December 22, 1987|From Reuters

NEW YORK — Manufacturers Hanover Corp. will lay off about 2,500 employees by the end of March, 1988, the biggest staff cut in the banking business since the October stock market crash, company sources said Monday.

The sources said Manufacturers Hanover President John McGillicudy had discussed the cutbacks, equal to 9% of its work force, with senior officers at the regular monthly meeting last week.

A spokesman for the New York-based bank would neither confirm nor deny the layoffs.

While the planned layoffs by Manufacturers Hanover are the biggest of any U.S. bank, other major banks, including Citicorp and Chemical New York, also have been trying to reduce expenses as loan volume stagnates, investment banking revenues slow and problems with Third World loans increase.

Many Departments Affected

Manufacturers Hanover, whose earnings have been lackluster for the past five quarters, already cut its staff by 2,900 between January, 1986, and September, 1987.

At the end of September the bank--the nation's sixth-largest--had about 29,300 employees. It has not said which areas it will trim, said the sources, who spoke on the condition of anonymity.

But one Manufacturer Hanover banker said: "We know something is going on. We know more layoffs are to come, and a reorganization as well, but no one knows exactly what."

Some departments are likely to be hit harder than others. Last week the bank cut 23 people, or 20%, of its municipal securities department.

One source said the layoffs would affect all departments.

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