Wellington broker lays off staff

Press, 21 November 1987, Page 27

Wellington broker lays off staff

A Wellington-based sharebroker is laying off 22 employees because of the downturn in business since the market crash on October 19.

MB Stockbrokers, Ltd, is laying 22 staff from its Wellington and Lower Hutt offices. This will leave 30 employees in these offices.

The managing director, Mr Rodger Gardiner, said yesterday that sharebrokers’ turnover was down 50 to 60 per cent. This was caused by the lower volume of trading and the lower price of shares. Last year, Mouat Holland • and Company merged with Buttle Wilson, of Auckland, for about six months. On the merger being broken up, Mouat Bolland became MB Stockbrokers. It retained an office in Auckland, and the Hamelyn

Group took a sizeable stake in the company.

The Auckland office staff is not being reduced. “This restructuring will tailor resources to expected business levels and is not the result of the firm losing funds in the recent sharemarket downturn, either through trading positions or bad debtors,” Mr Gardiner said. “Our losses have been less than $250,000, which is small in relation to our shareholders’ funds of $2 million.” Mr Gardiner expects sharemarket revenue to remain low for some time. A second Sydney broking firm was suspended from trading on the Australian Stock Exchange yesterday after experiencing liquidity problems in the wake of the sharemarket crash.

Lancaster Securities, one of the smaller firms trading on the floor, will be suspended indefinitely while the stock exchange establishes the company’s financial position.

The chairman of the Sydney Stock Exchange, Mr Kevin Troy, said a representative manager had been appointed to Lancaster to oversee its operations and settle transactions.

The suspension follows that last week of Gresham Securities Pty, Ltd, for a breach of the exchange’s liquidity requirements. Gresham is still suspended from trading and the National Guarantee Fund has been called in to expedite delivery of scrip.

Mr Troy said Lancaster’s liquidity problems were due to a “number of contributing factors.”