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Large Banks, Headed By Citi, Keep Reducing Workers In Order To Save Money

Large Banks, Headed By Citi, Keep Reducing Workers In Order To Save Money
The largest US banks continued to reduce staff in the first quarter, with Citigroup experiencing the largest decline.

After the third-largest U.S. lender completed a comprehensive reorganisation targeted at increasing earnings and cutting managerial layers, Citi's workforce shrank by 2,000 workers.
In comparison to the previous quarter, Bank of America, Wells Fargo, and PNC Financial collectively lost around 2,000 jobs during the three months that concluded on March 31.

Because of the hazy economic outlook, banks are under pressure to keep costs under control. Although investors continue to anticipate that the Federal Reserve will control inflation and prevent a significant recession, there is still uncertainty around the possibility of interest rate reductions later in the year.
As employees finish their notice periods, 7,000 job cutbacks will be recorded in next quarterly earnings, Citi's Chief Financial Officer Mark Mason said reporters on Friday. Citi's reductions were a portion of this total.
The layoffs were a part of a larger plan to cut 20,000 positions from Citi over the following two years.
Executives in the industry acknowledged the difficulties in adjusting to the shifting rate environment. Analysts predicted that banks would remain cautious due to rising funding costs, declining net interest margins, and inconsistent trading performance.
"We managed headcount," Bank of America CEO Brian Moynihan told analysts on Tuesday.
"We noted the expectation in January of last year that our headcount will be down throughout the year," he said.
By not filling positions when employees depart, or via attrition, the second-largest lender has essentially decreased personnel.
According to Moynihan, the organization's headcount has decreased by almost 4,700 since the first quarter of 2023.
Investment banks on Wall Street generated more revenue thanks to the recovery of the capital markets. The belief among executives that a spike in equity offerings will improve sentiment and encourage mergers and acquisitions has grown.
That would be good news for Morgan Stanley and Goldman Sachs, whose workforces decreased by 396 and 900 employees, respectively. On Tuesday, analysts were informed by Morgan Stanley's chief financial officer Sharon Yeshaya that the investment firm was still making "opportunistic hires."
Rival Goldman Sachs let off its largest number of employees since the 2008 global financial crisis in 2023.
On the other hand, JPMorgan Chase defied the pattern. The biggest bank in the United States added about 2,000 workers in the first quarter, bringing its total workforce to 311,921.

Christopher J. Mitchell

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