J.P. Morgan Chase & Co. announced plans during a Tuesday presentation to cut around 8,000 jobs in 2014 as demand for mortgage refinances declines.
The bank’s total employee headcount is slated for a reduction to 260,000 by the end of the year, compared to 265,000 at the end of 2013, J.P. Morgan said during its annual investor day. However, the layoffs will be partially offset by plans to add around 3,000 employees to the controls staff.
Around 2,000 of the job reductions will come from eliminating staff in the bank’s consumer and business banking division, with another approximately 6,000-person reduction planned in the mortgage banking branch, the presentation indicates.
J.P. Morgan’s refinance originations declined by $24 billion from 2012 to $103 billion in 2013, when the bank laid off around 11,000 mortgage banking employees. The overall refinance market is expected to drop around 60% from 2013’s levels to approximately $440 billion this year, according to the Mortgage Bankers Association.
The 2014 announcements come as J.P. Morgan looks to respond to the current environment, with plans to strengthen controls, focus on distinct customer segments, and rationalize cost structures via optimized branch network presence and digital self-service capabilities.
View the presentation, given by Gordon Smith, Chief Executive Office of Consumer & Community Banking.
Written by Alyssa Gerace