PNC Bank reportedly planning to reduce workforce by over 2,400 employees.
PNC, a leading American bank, has announced a significant round of layoffs, impacting more than 2,400 employees across its commercial lending, anti-money laundering, and other departments. The layoffs are a response to muted lending activity and declining interest income, and are part of a wider trend among banks to reduce headcount.
The bank's CEO, William S. Demchak, revealed the layoffs during a mandatory Webex conference call on an unspecified date. He also announced a more structural program that will have a direct impact on 2024 expenses.
The layoffs this week affected corporate workers based in Raleigh, North Carolina; Birmingham, Alabama; and Pittsburgh. This move may indicate that the cuts include some legacy employees brought over in PNC's acquisition of BBVA's U.S. footprint, as Birmingham's inclusion in the layoffs suggests.
PNC has already made a 4% headcount reduction earlier this year in its home equity and mortgage businesses. The bank aims to save $325 million in personnel expenses in 2024 as a result of the layoffs, and has set a total expense cuts target of $725 million.
Some affected workers were hired as recently as July, adding a layer of uncertainty to the situation. The layoffs will result in a reduction in staffing levels in certain areas, but the priorities and job functions targeted for reduction were not detailed.
The bank expects to take a one-time $150 million charge in the fourth quarter due to the layoffs. PNC has reviewed its organizational structure with an eye toward expense management, identifying an opportunity to better position the company for long-term success through the layoffs.
Several other banks, including Ally Financial, Wells Fargo, Citi, Truist, Barclays, and Goldman Sachs, have also indicated they expect to shrink headcount. This suggests that the banking industry is facing challenging times, and cost-cutting measures are becoming a common strategy.
Despite the tough decision, PNC remains committed to its employees and is providing support during this transition period. The layoffs are expected to take place by October 6, 2021.
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