American Express to Cut 2,000 Jobs (AP)
TWO COMMENTS: First, these are December layoffs (like many others this year). December layoffs are generally avoided since most companies layoff AFTER the holidays in January. The volume of December layoffs this year has surprised me.
Second ... this is interesting "The restructuring includes the company's business-travel operations". Is business travel falling off?
NEW YORK - American Express Co. Friday said it will cut 2,000 jobs, or 2.5 percent of its work force, in a restructuring designed to save more than $75 million a year before taxes.
The restructuring includes the company's business-travel operations, the sale of its banking operations in Bangladesh, Egypt, Luxembourg and Pakistan; and the relocation of some finance operations.
It said about 400 positions may be transferred to acquirers in the sale of the banking operations.
The cost of the cuts is expected to lower fourth-quarter earnings, before taxes, by $100 million to $120 million, the New York-based financial-services company said.
The total expected charge includes about $80 million to $90 million for employee severance packages, and about $20 million to $30 million in other costs mainly from the early termination of property leases, the company said.
The charge is not expected to materially affect profit for the quarter because the company also anticipates recording a gain for the sale of the leasing product line in its small-business financing unit, it said. The sale was completed on Dec. 1.
The company also will book a charge of $45 million to $55 million in 2005, when the restructuring is completed, American Express said.
Shares of American Express slipped 3 cents to close at $55.91 on the New York Stock Exchange (news - web sites).
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