Sun, 05 Jul 2020

US Bancorp is cutting thousands of branch workers as it works to adjust to changing customer preferences, according to a person briefed on the decision.

The cuts will be in the low thousands, the person said, asking not to be identified because the number isn't public. In a memo seen by Bloomberg, Chief Executive Officer Andy Cecere said US Bancorp "made the the difficult decision to eliminate their jobs because customer behaviours have changed."

The cuts represent less than 2% of the bank's workforce, according to spokesperson Molly Snyder. The company had 74 000 workers as of October 16.

Cuts are being made across the firm. Some job categories, including teller coordinator and assistant branch manager, are being eliminated or will have headcount greatly reduced. None of US Bank's roughly 3 700 branches will be closed as part of the reductions, according to Snyder, who confirmed the contents of Cecere's memo and declined to comment on the number of cuts.

The Minneapolis-based firm will also create some new customer-focused positions and launch a training program so existing employees can widen their skill sets, the memo said. Snyder said the firm will begin hiring client-relationship consultants and business-banking development consultants among other new roles to work in the branches.

Banks have for years been reassessing the role of branches in their strategies as customers increasingly handle their finances online. US Bancorp has said it plans to lean heavily on digital offerings and enter new markets with a "branch-light concept." Earlier this year, the firm hired Derek White from Banco Bilbao Vizcaya Argentaria SA as chief digital officer to boost innovation.

A McKinsey & Co. study released on Monday said banks are heading "into an arms race on technology" as new competitors like fintech startups try to take market share. Financial-services incumbents need to take dramatic action to fund innovation, or risk being left behind, the report says.

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