Less than one week after Deutsche Bank announced that it would be eliminating thousands of jobs from its core businesses, Standard Chartered (LON:STAN) has announced similar cost-cutting measures in a bid to help streamline its retail business.
Last week, Deutsche Bank predicted that a dramatic shift in its operations would see a reduction of its global workforce by nearly 9,000 full-time jobs by 2020 in addition to 6,000 external contractor positions that are also slated for oblivion.
The German lender is also setting up for two lean years, helping jettison nearly $4.4 billion of assets along with a staggering 20,000 jobs by 2017. Logistically, these job cuts will see a full exit from no less than ten countries, including Argentina, Chile, Mexico, Uruguay, Peru, Denmark, Finland, Norway, Malta and New Zealand.
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By comparison, Standard Chartered announced that it would cut approximately 15,000 jobs to help jump-start its retail transformation strategy. However, the news comes after the bank recently reported its sagging Q3 2015 revenues that yielded an unexpected -$139 million loss.
The unwelcome news for shareholders was reflective in an outright share price capitulation, which plunged over -7.0% during London trading Tuesday. At the time of writing, shares have rebounded slightly to 666p at the close, still incurring a -6.7% in one of its worst trading days in 2015.
Investors refused to be steadied by the bank’s restructuring plan, which intended to save nearly $2.9 billion by 2018, as well as a $5.1 billion rights issue in an attempt to help strengthen its balance sheet. In 2014 alone, Standard Chartered suffered from nearly 4000 retail jobs layoffs, however the lender’s upcoming plans seem to only add to this growing sum.
As per Standard Chartered’s bourgeoning strategy, the lender will aim to target its retail client systems and digital capability, whereby reaching a respective threshold of 30% of sales and 40% of payments online by 2018. However, with recent profit warnings in past quarters and a litany of negative press casting a shadow on the bank’s balance sheet, investors are unlikely to exercise caution ahead of what is shaping up to be some lean years.