A massive US bank now lays off 2,000 employees in efforts to cut back on costs after announcements were initially made in September.
Charles Schwab has laid off about 5% to 6% of its employees, amounting to roughly 2,000 people, as it looks to cut costs, per numerous reports.
A Schwab spokesperson said these “were hard but necessary steps to ensure Schwab remains highly competitive, with industry-leading levels of efficiency, well into the future.”
The company only released a percentage of how many people were laid off and didn’t give a precise number, but Schwab’s headcount was 35,900 as of September 30, according to a corporate fact sheet.
“They are decisions that impact very talented people personally, and we take that very seriously,” a spokesperson said.
“We worked diligently to ensure affected employees were treated with care and respect throughout this difficult process.”
The cost-cutting measures were first announced in the summer, with the brokerage looking to cut $500 million in costs as it faces investor pressure, reports CNN.
Part of the changes includes evaluating its “real estate footprint, streamlining our operating model, and staffing reductions, largely in non-client-facing areas,” a Schwab spokesperson said.
Like other banks, Schwab endured turbulence earlier this year when its bottom line was given a hard look by investors after the collapse of Silicon Valley Bank.
Citigroup also confirmed during the second quarter that new layoffs (1,600 in the second quarter) will push the total job cuts to 5,000 this year.
Wells Fargo also said that it could see its headcount decline further as it aims to improve efficiency, per Chief Financial Officer Mike Santomassimo.
Charles Schwab stock is currently down more than -35% this year-to-date.
Also Read: More US Banks Are Now Freezing and Closing Accounts
Other Banking News Today
Massive banks in Texas now announce closures for 2024 according to fresh data from the Office of the Comptroller of the Currency (OCC).
According to the OCC’s current weekly bulletin listing, the following Texas bank branches are permanently closing in 2024:
Wells Fargo 11152 S. Gessner Drive, Houston.
Bank of America 2601 Preston Road, Frisco; 13350 Dallas Pkwy, Dallas.
Capital One 2301 E. Riverside Drive, Austin; 2910 S. Lakeline Blvd., Cedar Park.
“No specific dates of closure have yet been listed, and it should be noted more Texas branch closures are expected to be announced in upcoming OCC bulletins,” reports Joel Eisenberg.
“The popularity of digital banking, inclusive of electronic payments and direct deposits, continues to be widely acknowledged by industry analysts as the primary factor in this regard.”
Bank of America recently listed bank closures in other areas of the country for 2024 as well as Wells Fargo.
Wells Fargo CEO Charlie Scharf recently rose attention during the company’s earnings call stating: “This company is not efficient – like, period. End of story.
Even with all of the reductions that we’ve made, it’s not surprising because as you peel the onion back, other things present themselves.”
Banks have stated that job cuts have also played an important role to weather strong recession conditions in 2024.
But Texas is not the only state facing mass bank closures.
Wells Fargo revealed last Friday that several branches would be closing in Arizona, Georgia, Iowa, Florida, Texas, and Alabama.
California also continues to be heavily affected, with both large and regional bank branches permanently shuttering this year.
According to data from the Federal Deposit Insurance Corporation (FDIC), approximately 8,000 banks were in operation in 2000, but by 2022, this figure was halved.
Also Read: Banks Are Now Closing Thousands of Accounts Daily
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