Credit rating agency Standard & Poor's elaborated on its previously announced plans to cut 172 jobs, saying it will dismiss about 30 of its structured finance analysts by month's end.
The company announced its intentions in an email to employees late Thursday afternoon, market sources said.
Company officials declined to give further specifics, including names of analysts who might be headed for the door, but those familiar with the situation said that the cuts would affect 10 analysts in both the CDO and CMBS groups, plus another 10 from another group involved in rating structured finance deals.
In January, parent company McGraw-Hill said the layoffs were part of efforts to restructure several struggling business divisions and shore up its long-term growth prospects.
"These positions are ... consistent with our efforts to streamline our operations and manage our costs," said Frank Briamonte, a McGraw-Hill spokesman.
Market sources familiar with the company, and who described the composition of the group as top heavy, said they would not be surprised if a lot of senior executives parted ways with the rating agency.
"If you sliced off the entire top third of structured finance [managing director and higher], nothing would happen," one market source said.
Job cuts were not the only changes. Sources say that Joe Sheridan, a former managing director of structured finance ratings, recently moved away from ratings and joined the group that handles credit quality and criteria. In that group, he reports to Tom Gillis, chief quality officer of structured finance ratings.
The latest round of dismissals, at the rating agency and outside of it, also represents a further contraction of the ABS market, in the eyes of some.
"Twenty-five percent of the people who were in the market in 2006 will be out of work by the end of this year," one market source predicted.
He added: "They're going to need job placement."
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