PNC Financial Services Group laid off employees across both its geographic footprint and its business lines this week, the latest example of downsizing in the U.S. banking industry.
The Pittsburgh-based bank joins a growing list of banks, credit unions and fintech companies that have cut employees in 2023. BMO Financial Group, Wells Fargo and USAA cut hundreds of workers in July and August amid declining prospects for short-term growth in the financial sector.
PNC issued a statement acknowledging the job cuts, and saying that as part of its focus on managing expenses it is shifting “away from work that is not fully aligned to our strategic priorities.” The $558-billion asset bank did not say how many employees received pink slips.
“While these decisions are never easy, we believe these measures will help us more effectively and efficiently deliver for our customers and stakeholders, now and going forward,” PNC said in a statement.
Analysts at Autonomous Research said in a research note Wednesday that they expect PNC to announce a “structural expense program” during the bank’s third-quarter earnings call this Friday.
Some of the PNC employees who were told this week that they were no longer needed were hired as recently as July, according to their LinkedIn profiles. Others built their careers at BBVA, the U.S. arm of Spanish banking giant Banco Bilbao Vizcaya Argentaria, which was acquired by PNC in 2020.
Corporate employees in Pittsburgh, Raleigh, North Carolina, and Birmingham, Alabama, among other U.S. cities, were laid off. The layoffs included workers in the bank’s commercial lending and anti-money laundering departments, according to a review of LinkedIn posts by affected employees.
One laid-off PNC employee said that she was invited to a video meeting on Tuesday morning, where she learned her last day at the bank would be Dec. 1. Employees on the call were muted, and a senior manager ended the call without taking questions, she said.
The employee, who works on business technology and innovation initiatives for PNC, said that prior to the meeting, there were no indications that cuts to her team were coming.
In July, PNC laid off workers in its home equity and mortgage businesses. Also that month, CEO Bill Demchak told analysts that the bank was “taking a hard look at opportunities for even further expense improvements across the franchise.”
Early in 2023, PNC said it would reduce expenses by $400 million throughout the course of the year. Executives said in July that they had identified an additional $50 million worth of expense savings for a total of $450 million. It is unclear whether the additional $50 million included employee layoffs.
During the second quarter, noninterest expenses at PNC totaled $3.4 billion, up 4% from the year prior. Chief Financial Officer Robert Reilly cited inflationary pressures and a challenging revenue environment as obstacles to keeping expenses under control during the bank’s second-quarter earnings call in July.
PNC reported total revenue of $5.3 billion in the second quarter, up 3.5% from the year-ago period.
A clearer picture of the size of the bank’s most recent workforce reduction will likely come into focus on Friday. PNC counted 60,301 employees at the end of June, according to regulatory filings. That was down from 61,127 a year prior.
The layoffs came days after PNC agreed to buy a portfolio worth $16.6 billion from Signature Bridge Bank via the Federal Deposit Insurance Corp. Neither party disclosed the purchase price of the portfolio, which could help bolster the bank’s fund banking business.