In what we are all hoping isn't the shape of things to come, MF Global has just announced an unexpected loss for the quarter ended 31st March (its fifth-straight quarterly loss) of $96.5m.
Jon Corzine (the former Goldman co-CEO who has been Chairman and CEO over at the firm since last month) said in a statement:
'This performance is simply unacceptable...We are taking decisive action to fundamentally improve the earnings profile of this company. The first step in this process is a realignment of our cost structure. We are focusing on compensation, including staffing levels and our incentive structure. In addition, we are reevaluating initiatives that do not demonstrate accretive characteristics in the near term. I am confident the decisions we are making will help drive profitability and demonstrate to our shareholders that MF Global can generate positive returns on capital.
'This company has tremendous potential and a timely opportunity to make significant inroads into the broader financial services industry', Corzine continued. 'As profitability improves and we ensure the appropriate controls are in place, we will look to enhance our revenue potential by supporting our client activities with more principal risk taking.
'In addition, financial regulatory reform efforts across the globe emphasize the importance of exchange-traded clearing arrangements and play into MF Global's core strengths. MF Global's strategic expansion into the equities and fixed income cash and derivatives markets, coupled with anticipated changes in the regulatory environment, will position the company to deliver better service to our client base as well as greater value to shareholders'.
The company is said to have frozen headcount, and is looking to reduce its workforce by between 10 - 15%, which will mean job losses of 320 - 410.