Northern Trust and Chase Bank announce cuts, Park Bank will move its Brookfield branch
Northern Trust to cut 450 jobs
Northern Trust Corp. announced yesterday that it will eliminate 450 jobs in 2009.
The Chicago-based company, which operates an office in Milwaukee, said it expects to record a pre-tax charge in the fourth quarter of 2008 of approximately $20 million to $25 million (5 to 7 cents per share) associated with severance and benefits relating to the elimination of the jobs and other costs.
The actions are expected to generate approximately $50 million to $60 million in annualized pre-tax savings, the company said.
Northern Trust said the layoffs are needed to improve its profitability under "difficult economic conditions. The layoffs will begin after the first of the year, and the company said it will use attrition whenever possible.
"The macroeconomic environment has been extraordinarily difficult and has impacted all segments of the global economy. Our decisions, while difficult, will further enhance Northern Trust’s position amid challenging conditions, while maintaining our focus on clients and those activities in which we have significant competitive advantage and continue to see opportunities for growth," said Frederick Waddell, chief executive officer of Northern Trust.
The company did not specify where the job cuts will happen.
Earlier this year, James Kuehn, president and CEO of Northern Trust’s Milwaukee office, told BizTimes Milwaukee that the office was adding office space to its headquarters at 526 E. Wisconsin Ave. to accommodate new employees, needed because of the bank’s local growth.
Monday’s announcement came weeks after Northern Trust disclosed that the U.S. Treasury will spend up to $1.5 billion to buy senior preferred and related warrants from the company under the federal Troubled Asset Relief Program (TARP) as part of the $700 billion federal bailout plan.
Chase to cut 266 jobs in Milwaukee
JPMorgan Chase & Co. announced last week that it will eliminate 266 jobs in its home equity application production center in the Chase Bank Tower in downtown Milwaukee at 111 E. Wisconsin Ave.
All of the employees were given 60-day notices of termination.
The center processes home equity loans around the country, bank spokeswoman Christine Holevas said. Chase has two other production centers in Phoenix, Ariz., and Columbus, Ohio. The Phoenix center is also being reduced by 100 employees, she said.
"The reason is volume," she said. "If the economy slows and housing volumes fall and we continue to tighten our lending standards, it means that loans to credit worthy borrowers have become more limited."
Over the past year, the bank’s home equity loan volume has have fallen by about 77 percent, Holevas said.
Chase Bank will still employ 240 to 245 people in home equity application production in Milwaukee. The bank has roughly 700 total employees in the Chase Bank tower.
"We are continuing with the product and are committed to the home equity business," Holevas said. "Right now we are matching the size of our staff to the volume. We are very committed to the work that these people do – they have a great work ethic. We are committed to Milwaukee. This is completely a function of numbers and volumes. What happens in the future, I don’t know."
Park Bank to move its Brookfield branch
Milwaukee-based Park Bank will relocate its Brookfield branch at 15850 W. Bluemound Road to a new stand-alone 10,000-square-foot branch at 14870 W. Greenfield Ave. in March of 2009.
The new branch, which is under construction, and will include three drive-through lanes.
The bank’s lease at its Bluemound Road branch will expire in April, said P. Michael Mahoney, chairman of the board, president and chief executive officer of Park Bank, and the company was looking for a more convenient location for its customers.
"Bluemound is getting more concentrated with traffic. I think for our customers, this will be easier access that is just as convenient, and it’s not even a mile away from our old location," Mahoney said.
Park Bank has about 65 employees in its current Brookfield branch. About 25 of those employees work on the branch’s operations, while the remaining 40 deal with back-room operations, Mahoney said. The 25 employees of the branch will move to the new branch, while Park Bank is negotiating a separate lease at an undisclosed location in Brookfield for its operations-related employees.
