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Report: 3,000 State Street staff seek redundancy

US – According to a newspaper report, 3,000 State Street employees have applied for voluntary redundancy under the bank’s cost-cutting plan.

State Street spokeswoman Hannah Grove declined to comment but said the bank would provide updated numbers in early to mid-July.

The Boston Herald, without citing the source of its information, said it has learned that as many as 3,000 workers, or one-fifth of its US workforce, have applied for redundancy. It added that many would go “by the end of this month” although some would probably be asked to stay for “a certain period of time”.

State Street’s chief operating officer Ron Logue said yesterday that severance packages would cost more than the 125-175 million dollars it had originally budgeted.

The Herald quoted Logue as saying that the group had had a “very positive response” to the redundancy plan.

Separately, the bank has confirmed that it is to sell its Priavte Asset Management business to Charles Schwab’s U.S. Trust arm for aound 365 million dollars.

“Our decision to sell the Private Asset Management business reflects our commitment to strengthen our focus on our core businesses,” said chairman and chief executive David Spina.

The PAM business employs around 180 people and contributed around two percent of State Street’s total revenue in 2002. The transaction is expected to close in the fourth quarter of 2003.

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