Posted on 06/15/2016 11:02:03 AM PDT by dennisw
A few months ago we pointed out that mass layoffs were coming for bankers due to declining revenues and more difficult market conditions, and now we're seeing the first major wave of that come to fruition.
Bank of America has announced that it will fire as many as 8,000 employees within its consumer division the FT reports.The core reason given for the headcount reduction in this instance is that digital banking is picking up the pace, and has reduced the need for "back office staff" and bank tellers.
This is a trend that BofA highlighted in its In its Q1 earnings press release, as the bank showed that mobile banking users had shot up 15% y/y.
The bank has already slashed headcount by more than 10,000 in 2015, and has cut almost 40,000 from its consumer division alone since 2009 (bringing the total at the end of Q1 to 68,400). The layoffs are in line with what has been happening to its retail branch count, which has fallen by about 1,400 over the past seven years. Thong Nguyen, president of retail banking told a conference in New York this week that the numbers would "probably go down to the low 60s", implying as many as 8,000 layoffs are on the horizon.
The division is critical for BofA, accounting for roughly 66% of the bank's Q1 net income.
As the FT points out, BofA is especially exposed to monetary policy as it has a significant domestic retail presence. Due to central planning around the globe, rates have plummeted, leaving banks to find other measures to put a floor under profitability. Said another way, banks need to cut costs and cut them quickly in order to mitigate the squeeze on NII.
"We're not waiting for the rates to come up to keep driving the increase in profitability" Nguyen said.
Alas, although the Fed did hike in December, BAC has under performed its peers since that date - meaning the bank has a lot of catching up to do in order to soothe investor concerns, and these cost cutting measures play a part in that effort.
here we go again.....
in other news, a boatload of lawyers just sank...
They been killing themselves.
I wonder where these numbers will be buried in the next Job number report?
Well I fired them for being the Bank for Illegal aliens years ago.
Lost two BofA banks locally - one was quite large.
What is a banker? I haven’t been inside a bank in probably 10 years. Who needs “bankers”?
Didn’t Obama blame ATMs for unemployment?
Better fire up the Dead Bankers Ping list!...............
The bad news is there was an empty seat!.............
"There's no place for sentiment in big business."
not good. more of the obama economic recovery
Give a few billion to hillary’s campaign, and she’ll give the bank a trillion or so of our money.
Their behind the times. I belong to USAA...no tellers. Heck no buildings. That is the way all banks should go. It is the efficient way to bank. The old fashioned way needs to go.
Having been with BoA for many, many years I can say I’ve noticed the cut backs.
Seems like every year they find a way to shave more money out of my accounts while cutting back on services.
I’m not an on line or debit card person. I prefer to get chase and then pay cash during my shopping and eating out.
BoA has closed a number of drive throughs at the branches I go to and cut back on the tellers. At lunch there might be one working with a long line.
Closed two of my BoA accounts yesterday.
BofA’s place was taken over by Compass who was bought out, I believed by Spain, and changed its name to BVAA Compass. All the tellers are Hispanic or Pakistani. Lots of Mexicans do business there, at least in our area.
58,000 people fired since 2009.
I bet the ceo hasn’t lost a dime in their income.
I go twice a year for new envelopes and to make sure they are still open. My bank is 30mi away.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.