Ally Financial laid off hundreds of its roughly 11,000 employees Tuesday, a spokesperson confirmed Wednesday.
Spokesperson Peter Gilchrist said the job cuts, which aren’t specific to any location or line of business, amount to less than 5% of its workforce.
He called the cuts “a right-siz[ing],” noting that the bank continues to hire in certain areas of business.
Those affected are receiving career placement support and a “robust severance package” and are also invited to apply to other openings within the company. Some of the affected employees work in the Charlotte, North Carolina, area, according to the Charlotte Observer.
“We remain confident in our long-term strategy and our ability to deliver compelling returns given the strong underlying trends in our core businesses,” Gilchrist said. “While decisions involving our teammates are never easy, we believe they will help us more effectively and efficiently deliver for our customers and stakeholders, and we'll continue to be diligent in our expense management going forward.”
Ally CEO Michael Rhodes said in December that the bank no longer originates mortgage loans to its balance sheet, and Gilchrist said a full mortgage business exit – set for the first quarter – was also announced to employees Tuesday.
“We are refining our focus on where we lead the market and can set the bar for excellence. As a result, we will cease originations in our mortgage business in the first quarter and gradually run-off our remaining assets,” Gilchrist said.
Rhodes also indicated in December that the credit-card business wasn’t a core focus for the bank. In an email to Banking Dive, Gilchrist said Ally was exploring “strategic alternatives” for its credit-card business in the first quarter.
A number of Ally’s top posts were filled anew last year, including by Rhodes, who took the CEO post last April. Stephanie Richard and Meghan Ryan were elevated to chief risk officer and chief audit executive, respectively, in November; and former Discover legal chief Hope Mehlman made a lateral move to Ally in December.
