Big US banks, led by Citi, under pressure to trim staff to cut costs
US banking giants continued to shed employees in the first quarter, with Citigroup seeing the biggest drop.
Headcount at Citi declined by 2,000 employees after the thirdlargest US lender completed a sweeping reorganisation aimed at improving profits and reducing management layers. Headcount at Bank of America, Wells Fargo and PNC Financial declined by about 2,000 jobs combined in the three months ended March 31 compared with the previous quarter.
UNDER PRESSURE
Banks are under pressure to control costs due to the uncertain economic outlook. While investors are still expecting the Federal Reserve to tame inflation while avoiding a major economic slowdown, expectations remain in flux about the potential for interest-rate cuts later this year. Citi’s reductions were part of a total 7,000 job cuts that
Citi’s reductions were part of a total 7,000 job cuts that will be reported in upcoming quarterly earnings as employees complete their notice periods
will be reported in upcoming quarterly earnings as employees complete their notice periods, its Chief Financial Ocer Mark Mason told media.
The layos were part of a broader goal to reduce Citi’s stang by 20,000 over the next two years.
Industry executives acknowledged the challenges in navigating the changing rate environment. Analysts said higher funding costs, contracting net interest margins and uneven
trading results were likely to keep banks cautious. “We managed headcount,” Bank of America CEO Brian Moynihan told analysts. “We noted the expectation in January of last year that our headcount will be down throughout the year,” he said. The second-largest lender has largely reduced stang through attrition, or not filling positions when employees leave. Its headcount has fallen by more than 4,700 from the first quarter of 2023, Moynihan said.