Knight Capital Group to cut workforce by 5%
Knight said it expects to incur a pretax charge between $9 million and $11 million in the first quarter as a result of combining its voice and electronic sales teams and winding down its correspondent clearing operations. It expects additional costs related to the winding down of the correspondent clearing unit, but said the costs could not be immediately determined.
A spokesman for Knight said the company had no comment beyond the filing.
Knight had 1,524 full-time employees as of year-end, up from 1,423 a year earlier, mainly due to an acquisition but also from growth in its reverse mortgage origination business and in market making - matching buy and sell orders in stocks and options.
The company was forced to take on additional investors and re-examine its entire business following a software problem in August that led to millions of unintentional orders flooding into the market over a 45-minute period, leaving Knight with a huge position it had to unload at a loss of $461.1 million.
Following the glitch, Knight secured $400 million in rescue financing - in exchange for a more than 70 percent stake in the company - from a group of investors that included Chicago-based Getco and was led by Jefferies Group Inc.
Jefferies later helped finance Getco's proposed
Be the first to comment.