State Street lays off 1,500 employees to cut costs

New CEO Ronald O'Hanley says firm needs to reduce structural costs by 2% to 3% a year

Jan 18, 2019 @ 11:18 am

By Bloomberg News

State Street Corp. said it's laying off 1,500 staff as part of a plan to reduce costs.

The layoffs equate to about 6% of the workforce in high-cost locations, the Boston-based bank said in an earnings statement Friday. Senior management is being reduced by 15%.

Ronald O'Hanley, who took over this month as chief executive officer of the money-management and custody-banking giant, is pushing to reduce expenses, automate more functions and simplify the organizational structure. Bloomberg reported last week that State Street began cutting 15% from its ranks of hundreds of senior managers, including executive vice presidents and senior VPs.

(More:New State Street tool helps advisers determine if clients want ESG investing)

The new CEO has said the firm needs to reduce structural costs by 2% to 3% a year.

Investors responded warmly to news of the job cuts: State Street's stock has rallied 13% this year, making it the second-best performer among 18 companies in S&P's index of money managers and custody banks. The shares sank 35% in 2018 as rocky markets crimped third-quarter fee revenue and analysts questioned whether the purchase of a software maker was too costly.

0
Comments

What do you think?

View comments

Recommended next

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print