Twenty of the world’s largest banks shed at least 61,905 jobs total in 2023, the Financial Times found last week, citing company disclosures and a tally of the outlet’s own reporting of large-scale reductions.
“There is no stability, no investment, no growth in most banks — and there are likely to be more job cuts,” Lee Thacker, owner of Silvermine Partners, a financial services headhunting firm, told the outlet.
Among the banks measured, UBS — perhaps unsurprisingly — made the deepest cuts: 13,000. The Swiss government persuaded the bank to take over its flagging rival, Credit Suisse, in March. Credit Suisse, by its own count, had already said it expected to cut 9,000 jobs in a wide-scale restructuring. For his part, UBS Chair Colm Kelleher has said 2024 would be “the first year we don’t have the cover of the ‘easy’ costs,” a label he applies to headcount math.
Not far behind UBS among staff cuts in 2023, however, was Wells Fargo, at 12,000, the Financial Times reported. The bank reportedly cut 7,000 jobs in the third quarter alone and spent $186 million on severance costs in that three-month span, according to the outlet. But Wells appears headed for a far deeper cull, having set aside between $750 million and $1 billion in the quarter that just ended for “unanticipated” severance costs, CEO Charlie Scharf said last month.
“We have seen turnover come down,” Scharf said at Goldman Sachs’ U.S. Financial Services Conference. “Unfortunately, we’re going to have to be more aggressive about our own internal actions.”
While the Financial Times’ nearly 62,000-position tally is considerably less than the roughly 140,000 jobs the same lenders cut in 2007 and 2008, one change from other recent years with relatively heavy reductions is the source: At least half of the lost jobs came from Wall Street lenders, according to the FT’s count.
By comparison, other years with heavy cuts — 2015 and 2019, for example — were punctuated by big losses at European banks that struggled against low interest rates.
Last year brought a mix of other factors, including overstaffing in response to the uptick in dealmaking in 2021 as the market recovered from the COVID-19 pandemic. Mergers and acquisitions saw a sharp decline early in 2023 before the segment picked up again in the fourth quarter.
That surge, however, is spurring some banks to stand pat on staffing.
“Some banks are hesitating at the moment because of the amount of dry powder sitting on the sidelines, especially in the Americas,” Gaurav Arora, global head of competitor analytics at Coalition Greenwich, told the Financial Times.
At least two of the banks in the tally — Morgan Stanley and Goldman Sachs — launched layoffs in the opening days of 2023. The former shed 4,800 jobs last year, by the FT’s count; the latter, 3,200 (although smaller rounds of cuts later in the year likely pushed that number up).
Citi cut 5,000 jobs in 2023, by the Financial Times’ count. Bank of America dropped 4,000. The 1,000 jobs the outlet attributed to JPMorgan came from the bank’s May acquisition of First Republic Bank.
By percentage, the U.K.’s Metro Bank — undoubtedly one of the small lenders whose cuts the FT tallied — ranked as the most affected, as the bank saw a 20% reduction in staff in 2023.
