BNY Mellon is to slash three per cent of its global workforce and institute an immediate freeze on new hires and outside contractors as it bids to reduce expenditure during hazardous economic conditions.
The investment management and services group says the cuts will effect 1500 of the company's global workforce of 48,900.
The banks says it expects to lessen any impact of the reductions on current staff by taking advantage of natural turnover, "implementing an immediate hiring freeze across much of the company and reducing the use of temporary workers, consultants and contractors. These initiatives are in addition to ongoing operational and technology efficiency efforts."
The move to slash expenses was pre-figured in a conference call in July, when BNY Mellon chairman and CEO Robert Kelly presented Q2 results to analysts which showed expenses up 21% year-over-year. Twelve percent was related to acquisitions and as much as three per cent of the growth pinned on increased regulatory compliance and litigation costs.
Describing the latter as "the unpleasant realities of a post-crisis environment", Kelly vowed the company would put together an expense reduction plan which would be presented to analysts in October.
"In terms of expenses, they're too high," he said. "The bottom line is we're not getting positive operating leverage year-over-year. We need to and we will."