The US financial giants Wells Fargo, Bank of America, and Citigroup revealed in their fourth-quarter reports that they cut their workforces by a total 17,700 last year.

Banks terminated staff members or ceased hiring new ones last year as dealmaking dried up and borrower demand decreased.

The biggest lender in the country, JPMorgan Chase, defied the trend by adding staff for a third year in a row.

This year may continue to be difficult for the sector as banks may reduce lending due to the decline in commercial real estate and the more stringent projected capital regulations.

Due to dealmaking being hindered by economic uncertainty, Wall Street businesses suffered last year.

Despite a 7% increase in 2023, the S&P 500 banking index outperformed indexes that tracked consumer discretionary or industrial companies.

The institution announced intentions to eliminate 20,000 positions over the following two years, including layoffs from a broad reorganisation and other business changes. Citigroup’s employment decreased by 1,000 to 239,000 people in 2023.

The workforces at Wells Fargo and Bank of America shrank by 5% and 2%, respectively, in the previous year.

More than 16,200 new workers were hired by JPMorgan. In a bailout deal in May, the bank acquired First Republic Bank, a bankrupt lender. Since 2021, employment has increased annually.

Next week, Morgan Stanley and Goldman Sachs are expected to reveal their most recent employee counts. Compared to last year, they had eliminated almost 4,300 employment as of September’s conclusion.

Goldman Sachs conducted its largest round of layoffs since the 2008 global financial crisis earlier in 2023.

Denis Coleman, the bank’s CFO, stated in October that they might make “selective investments” in headcount.

(Adapted from Reuters.com)

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