JPMorgan, BofA cautious on job cuts as Goldman Sachs layoffs loom

JPMorgan Chase and Bank of America, the two largest US banks by assets, expressed caution about job cuts in contrast to Goldman Sachs, where hundreds of employees could be laid off earlier this month. .

“You need to be very cautious when you start cutting bankers here and there,” said Daniel Pinto, JPMorgan’s president and chief executive officer, at a conference on Tuesday. because you will hurt your ability to grow in the future. . “If something happens, in some environment like this, maybe there are some very, very top bankers that you weren’t able to reach or hire before, they’re ready now. to be hired.”

That stance compares to Goldman Sachs Group Inc’s plan to cut jobs as early as this month after halting its two-year annual practice during the pandemic, according to a source familiar with the matter. . Goldman had an employee headcount of 47,000 at the end of the second quarter, up 15% year over year.

Wall Street bankers are increasingly concerned about layoffs in the coming months. As recession loomed and the Federal Reserve raised interest rates to curb inflation, trading markets dried up.

Lance Roberts, investment strategist and economist at RIA Advisors, said JPMorgan’s upbeat view underpins the company’s approach to the workforce.

“We’ll see if JPMorgan is correct in their more optimistic view, but history shows that with the Fed aggressively raising interest rates and reducing its balance sheet, the outlook is going to be a bit brighter,” Roberts said. more cloudy with the possibility of heavy rain.”

The company’s CEO said that despite the investment banking downturn, Bank of America is now satisfied with its staffing level.

Brian Moynihan told Fox News in an interview: “We’re fine with our headcount. “I’m confident if we need to manage staffing as people leave us for other employers, we won’t fill all the jobs, but we’re in good shape. .”

JPMorgan had to adjust wages to cope with “higher” attrition in the first half of the year, the bank’s president, Pinto, said. While attrition is still high, it is normalizing, he said. The bank had more than 278,000 employees at the end of the second quarter, up 7% from a year earlier.

Citigroup declined to comment on job cuts.

Moelis & Co cited Reuters comments in July from chief executive Ken Moelis, who said the investment bank’s talent system is strong and it has a strong hiring plan.

The boutique investment bank on Tuesday announced the addition of Igor Sokolovsky from Guggenheim Securities as managing director in New York to advise clients on mergers and acquisitions, specializing in the healthcare sector.

Moelis said at the time, referring to the big banks: “That word comes right in on Labor Day to look at your headcount in a bad year. “That’s just how the cycle works.”

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