InvestorDaily understands Morgan Stanley is reducing its global workforce by 5 per cent over the June quarter as part of a business revamp tipped to impact up to 3,000 employees.

This includes cuts to its Australia-based team, with 12 employees to lose their jobs, equating to 2 per cent of its total Australian workforce (approximately 500 employees).

However, the wealth division and the firm’s independent financial advisers will be spared, with no immediate plans of an overhaul.

Morgan Stanley employees over 100 financial advisers across five branches, managing approximately $41 billion in client assets.

Reports suggest Morgan Stanley’s banking and trading would absorb much of the job cuts across the firm’s global network.

InvestorDaily approached Morgan Stanley for comment on the matter but a spokesperson declined to comment.

The global workforce adjustment is the second in months, adding to a 2 per cent cull earlier this year.

The news comes just a week after Morgan Stanley confirmed its long-serving CEO, James Gorman, will step down “within the next 12 months”.

The company’s board said it is identifying candidates to replace Mr Gorman as part of a succession planning process.

“I fully expect one of the internal candidates to replace me when I step down,” the outgoing CEO stated.

Mr Gorman has served as chairman of the board of directors and CEO of Morgan Stanley since January 2012.

Morgan Stanley reported a net revenue of US$14.5 billion (AU$22.2 billion) over the first quarter of the 2023 calendar year, down 2 per cent on the previous corresponding period.

Net income fell 16 per cent to US$3 billion (AU$4.6 billion), with the decline attributed to a “volatile market environment”.

The group’s wealth management business was a bright spot, attracting net new assets of US$110 billion (AU$169 billion), offset by a 8.3 per cent decline in revenue across asset management to US$3.3 billion (AU$5 billion).

This resulted in a 10 per cent per cent increase in net revenues to US $6.5 billion (AU$10 billion).

Despite the underlying dip in earnings, Mr Gorman said the firm delivered a strong result in a “very unusual environment”.

“The investments we have made in our wealth management business continue to bear fruit as we added a robust $110 billion in net new assets this quarter,” he said at the time.

“Equity and fixed income revenues were strong, although investment banking activity continued to be constrained.

“We maintained our strong capital levels and remain well positioned to provide long-term value to our shareholders.”