U.S. has entered into a modest recession says Etrade Management
In the text of the earnings announcement, ETrade management said they believe the U.S. economy has entered a “modest recession”.
Management has also revised its view of the economic and market outlook since the fourth quarter earnings call in January, and assumes the now-consensus view that the U.S. has entered into a modest recession. As a result, the Company is announcing that it will undertake additional restructuring activities this year to further reduce operating expenses.
“We are clearly facing a cyclical downturn in the economy and markets, and because we will be a simpler company after the disposition of certain non-core assets, we need to reduce our overall expense base,” stated Mr. Layton. “Our revised expense reduction program is designed to lower annual run-rate compensation-related expenses by 10 percent, approximately $50 million per year. We expect the majority of the plan to be implemented by the end of the second quarter.”
The online banking and brokerage company has been besieged by the downturn in the U.S. housing sector. The company announced a $91.2 million loss for the quarter ending March 31st, 2008.
Tags: Recession
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