JPMorgan Chase to cut 8000 jobs and shrink branches
26 February 2014 | 5731 views | 4
JPMorgan Chase has set out plans to cut around 8000 jobs this year as it shrinks branches and pushes self-service and the use of digital channels.
At its investor day, the bank confirmed that the headcount at its consumer and community banking division will be cut by 8000 to 149,000 people this year.
The decision has been partly attributed to the rise of digital channels for self service. Online and mobile log-ins have risen at a CAGR of 28% over the last three years. In contrast, teller transactions have fallen by four per cent CAGR.
Almost 10% of deposits are now made through mobile phones and this is resulting in considerable cost savings. A teller deposit cost the bank 65 cents, while a mobile phone-based QuickDeposit costs just three cents.
This shift in customer behaviour will see JPMorgan Chase continue to "optimise" its branches, making them smaller, with fewer tellers and more self-service options for customers.
However, unlike many other US banks - which collectively cut 1500 branches last year - there are no plans to reduce the size of the network.
At the investor day, chief executive Jamie Dimon also spoke about the competition his bank faces from rivals, including technology giants like Google and Apple that are targeting the payments world.
Technology firms "all want to eat our lunch," he told Bloomberg. "I mean every single one of them, and they're going to try."