Bear Stearns slashes 650 jobs

Bear Stearns will cut 650 jobs before the end of the year as part of the bank’s cost-cutting drive, after heavy subprime mortgage-related losses earlier in the year.

The cuts, most which are expected to be in the firm’s fixed-income division, come on top of 900 job cuts in August, including 240 in Bear Stearn's mortgage-lending unit.

By the end of the fourth quarter, the biggest underwriter of US mortgages will have slashed more than 10% of its 15,000-strong global workforce, of which 1,200 are based in London.

Bear Stearns saw profits drop 61% to $17.3 million in the third quarter and by 33% to $362 million in the second, due to “extremely difficult securitisation markets and high volatility levels across asset classes,” according to the firm.

See also: Bear profits tumble by 61% as Goldman's rise 79%