In sync with its plans to contain expenses and improve operational efficiency, JPMorgan Chase & Co. JPM intends to shift its technology staff out of UK headquarters. Nearly 350 employees will be relocated to the company’s regional centers in Bournemouth and Glasgow from London’s Canary Wharf by 2017 at the earliest.
JPMorgan employs roughly 4,500 people in tech-related roles across Europe, with majority based in UK. Specifically, the bank’s Bournemouth office has approximately 1,000 technology staff, while over 800 persons work at Glasgow office.
Relocation to regional hubs is part of JPMorgan’s wider plan to narrow down the scope of technological work at its London headquarters to basically important skill roles or internal customer-dealing jobs. Therefore, only those tech staffs that require interaction with the bank’s operations including trading floor will remain at the London office, while other employees will be relocated.
As JPMorgan attempts to enhance efficiency and continues to manage cost prudently in the Corporate & Investment Bank (“CIB”) segment, we believe this relocation will support its expense-saving initiatives. At the latest Investor Day conference in Feb 2015, Daniel Pinto, the chief executive of CIB, had drawn up extensive plans to lower the segmental expenses by $2.8 billion to reach $19 billion by 2017. Of this total amount, nearly $1 billion of savings is expected to come from technology and operational divisions.
Notably, despite its efforts to lower technology-related expenses, JPMorgan has also been investing heavily in tech-related hubs with an aim to focus on automated banking, which has been gaining ground over the past few years. This is also expected to save expenses in the long run.
Currently, JPMorgan carries a Zacks Rank #4 (Sell).
JPMorgan is not the only bank that is trying to control costs. Other major global banks including Bank of America Corporation BAC, HSBC Holdings plc HSBC and Barclays PLC BCS are striving to manage expenses prudently to improve overall efficiency.
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