Northern Trust cuts 700 jobs to reduce costs
US – Northern Trust has cut 700 jobs as part of a drive to reduce annual operating expenses by 145-150 million dollars.
Spokeswoman Sue Rageas said the cuts were “across the corporation” but was unable to specify how many, if any, European jobs were affected. She said she assumed there were European job losses.
The Chicago-based bank said that most of the jobs were cut in June. They follow 690 job cuts that came as part of the sale of its Northern Trust Retirement Consulting business to Hewitt Associates that was completed last week.
The cuts would lead to a second-quarter net pre-tax charge to earnings of around 51.5 million dollars.
“Today Northern Trust Corp. announced that as part of an ongoing review of its business and operations it has taken a number of strategic steps to reduce expenses and better position the corporation for improved profitability,” the securities services company said in a statement.
In April Northern Trust said it was undergoing an “intensive review” of its business and operations following a sharp decline in quarterly earnings, which saw first-quarter earnings fall to 94.7 million dollars from 127.6 million dollars a year before.
The reductions will take its total staff to less than 8,000, 15% down on the 9,336 at March 31 2003.
It added that it made a 20.2 million dollar loss on the sale of the NTRC assets to Hewitt.
Chairman and chief executive William Osborn said: "We are taking these steps to allow us to improve profitability and focus our resources where we have clear competitive advantages and can serve our clients best.
“We are committed to delivering value to our shareholders and clients and to operating in a productive and efficient manner.”
He added: “Northern Trust remains strategically focused on the asset administration and asset management business, delivered to our target personal and institutional clients.
“We will continue to invest in this core business, through acquisitions that fit with our key strategies, expansion into new markets and investment in leading edge technology."