Citing overcapacity for processing online trading orders in light of the recent stock market sell-off, Charles Schwab in the US has announced plans for major job cuts amounting to 11 per cent to 13 per cent of its workforce.
The bulk of the cuts will come in the second quarter of the fiscal year.
"It's been a difficult decision," said Charles Schwab, chairman and co-CEO of the brokerage firm said.
But according to Schwab, the markets have moved from a position of "tremendous exuberance" early last year into a "somewhat recessionary period" today.
Schwab said he doesn't expect confidence levels to bounce back for at least another year. As a result, he added, the company now has excess capacity for handling the amount of transactions being processed by its customers.
Schwab spokeswoman Jennifer Hallahan said the company won't make final determinations as to which departments and locations will see the cuts for another 30 to 45 days.