Expect more cuts to come, says one broker, following the announcement that one big bank has axed 1,500 jobs.
“I think there will be more job cuts at Canadian Banks; Scotia
was just the beginning,” Ron Butler
Butler Mortgage wrote on MortgageBrokerNews.ca. “Brian Porter timing was smart, he was the first to do what all the banks will eventually do: eliminate internal staff positions. Keep the client facing staff in place but use technology and plain old "work harder for the same pay" to pick up the slack on the jobs cuts.”
Last week, Scotiabank announced it will lay off 1,500 people at a cost of $148 million.
“Scotiabank … announced that it expects to record certain charges in its fiscal 2014 fourth quarter earnings, aggregating to a total of approximately $451 million pre-tax, or $341 million after tax,” an official release from the bank states. “The Bank has initiated certain restructuring initiatives in order to improve the speed and quality of service it provides its customers, to reduce costs in a sustainable manner, and to achieve greater operational efficiencies.”
Those “efficiencies” will come from across the Canadian operation.
Scotia isn’t yet specifying which divisions will bear the heaviest brunt of the cost-cutting, although it singles out wealth management operational support as one area that will see significant cuts. It is worth noting that two thirds of the reductions will be in Canada.
One former Scotia employee – and current mortgage broker – recognizes the move as a bid to become more competitive and efficient.
“As a former Scotiabank employee for 28 years, I can understand how conservative and proactive is the Bank's mandate and direction,” Angelo Wong-Liao of Invis the Money Lady wrote on MortgageBrokerNews.ca. “To start tighten up now and to shed jobs for operational efficiency to compete internationally is a proactive approach.”