* Payrolls cut in mortgages, retail banking
* Bank reducing staff per branch even as it adds branches
* Some job additions in cards and business lending
* Net reductions represent 6.6 pct of JPMorgan overall
By David Henry
NEW YORK, Feb 26 JPMorgan Chase & Co
said on Tuesday that it plans to cut 17,000 jobs by the end of
2014, representing about 6.6 percent of the company's overall
workforce, as the bank sheds staff that helped it deal with bad
The bank is optimistic that it can generate record income
this year and is planning to add 4,000 employees in commercial
and investment banking and credit cards to help it win business,
bank executives said at an investor conference.
That hiring will be more than offset by job cuts in areas
like mortgage servicing and retail banking, where the bank is
positioning for a recovering housing market and new forms of
branch banking. The net impact of the additions and cuts will be
17,000 fewer employees on the bank's payrolls.
The job cuts reflect the pressure that banks are under, even
as the U.S. housing market and overall economy show signs of
recovery. Many banks are looking to automate more of their
businesses to make their staff more productive and improve
For example, at JPMorgan's branches, where it plans to cut
about 6,000 tellers and other employees, the bank hopes
customers will use automated teller machines for every day
transactions and that remaining staff can focus on higher-margin
activities like selling wealth management services.
JPMorgan is one of the few big U.S. banks that is still
adding branches to its network, but it is hoping to staff the
branches with fewer workers. The bank's 5,614 branches have
63,500 employees, representing about a quarter of JPMorgan
Chase's total. Chase's branch network is second to Wells Fargo &
Co's in size.
For overall staffing levels, JPMorgan Chase had 258,965
employees globally at the end of 2012. Its headcount rose
following the financial crisis to 262,882 in the second quarter
of 2012 from 219,569 in the first quarter of 2009. Since last
year's second quarter, staffing levels have drifted lower.
JPMorgan Chase overall earned $21.9 billion last year,
excluding accounting charges linked to changes in the value of
its debt. The bank said it has the potential to earn about $27.5
billion, thanks in part to efficiency gains. It aims to cut
overall expenses by $1 billion in 2013.
To reach the $27.5 billion profit figure, the bank is also
counting on costs for lawsuits to fall as disputes over bad
mortgages are resolved, as well as seeing a one percentage point
rise in interest rates, said Chief Financial Officer Marianne
The profit scenario also depends on the bank not being hit
by another trading debacle like the $6.2 billion loss last year
on derivatives trades placed by the London Whale, the nickname
given a London-based JPMorgan trader for the size of the
Chief Executive Jamie Dimon acknowledged that many of his
top lieutenants who spoke to investors on Tuesday were in new
jobs after changes he made last year in his management team and
the bank's divisions.
"It is a little bit too much change in one year," Dimon
said. "Some of it was the Whale. Some of it was the re-org" to
better align product divisions with customer interests, he said.
All of the top executives, however, have been at the company
several years and know its businesses, Dimon said.
JPMorgan Chase shares were down 0.2 percent at $47.60 at the
close of trading on Tuesday on the New York Stock Exchange.