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JPMorgan Said to Cut 100 Staff to Condense its Private Bank
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JPMorgan Chase & Co. (JPM - Free Report) is said to eliminate around 100 employees in its private bank as part of the company’s restructuring strategy regarding the latter. The decision was announced internally and first reported by the Wall Street Journal.
The layoffs, which will affect the staff in several locations and departments, come on the heels of previous rounds of layoffs in recent months. The company has been getting rid of underperforming employees, including financial advisers and support staff in locations across the U.S., in its private banking division.
The company had previously slashed about 5% positions in its Asia-Pacific wealth-management unit. The reduction affected mostly relationship managers and investment consultants who cater to clients at J.P. Morgan’s regional private bank.
Moreover, the division has also curtailed over 100 employees in New York, London, Washington, and Boston in the past few months, according to the Wall Street Journal.
However, the company has been actively hiring as well. The private bank currently employs around 12,000 people. Further, revenue in JPMorgan’s private bank has increased in nine of the past ten years, hitting $5.8 billion in 2015, according to filings.
The job cuts follow the company’s plan to restructure its private banking unit to sharpen focus on higher-net-worth individuals, who are less of a risk and generate higher fees. The company has been selective in choosing who qualifies for such personalized service to wealthy clients.
Also, per a previous Wall Street Journal report, JPMorgan’s private bank clients will be required to have at least $10 million in investible assets, twice the current minimum of $5 million, later this year.
Wealthy clients usually generate steady revenues as fees are based on a percentage of assets under management rather than transactions. Also, new regulations designed to limit riskier activities have hit investment banking and trading businesses harder than wealth management and private banking.
This has led to an industrywide trend among large banks like Deutsche Bank AG (DB - Free Report) , Wells Fargo & Company (WFC - Free Report) and The Goldman Sachs Group, Inc. (GS - Free Report) to shift focus toward wealthy clients.
Currently, JPMorgan carries a Zacks Rank #3 (Hold).
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JPMorgan Said to Cut 100 Staff to Condense its Private Bank
JPMorgan Chase & Co. (JPM - Free Report) is said to eliminate around 100 employees in its private bank as part of the company’s restructuring strategy regarding the latter. The decision was announced internally and first reported by the Wall Street Journal.
The layoffs, which will affect the staff in several locations and departments, come on the heels of previous rounds of layoffs in recent months. The company has been getting rid of underperforming employees, including financial advisers and support staff in locations across the U.S., in its private banking division.
The company had previously slashed about 5% positions in its Asia-Pacific wealth-management unit. The reduction affected mostly relationship managers and investment consultants who cater to clients at J.P. Morgan’s regional private bank.
Moreover, the division has also curtailed over 100 employees in New York, London, Washington, and Boston in the past few months, according to the Wall Street Journal.
However, the company has been actively hiring as well. The private bank currently employs around 12,000 people. Further, revenue in JPMorgan’s private bank has increased in nine of the past ten years, hitting $5.8 billion in 2015, according to filings.
The job cuts follow the company’s plan to restructure its private banking unit to sharpen focus on higher-net-worth individuals, who are less of a risk and generate higher fees. The company has been selective in choosing who qualifies for such personalized service to wealthy clients.
Also, per a previous Wall Street Journal report, JPMorgan’s private bank clients will be required to have at least $10 million in investible assets, twice the current minimum of $5 million, later this year.
Wealthy clients usually generate steady revenues as fees are based on a percentage of assets under management rather than transactions. Also, new regulations designed to limit riskier activities have hit investment banking and trading businesses harder than wealth management and private banking.
This has led to an industrywide trend among large banks like Deutsche Bank AG (DB - Free Report) , Wells Fargo & Company (WFC - Free Report) and The Goldman Sachs Group, Inc. (GS - Free Report) to shift focus toward wealthy clients.
Currently, JPMorgan carries a Zacks Rank #3 (Hold).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>