Canada’s Scotiabank is planning to reduce its global workforce by approximately 2,700 employees, which amounts to about three per cent of its total workforce. This layoff is in response to the challenging economic environment, and it marks one of the largest job cuts among Canadian banks. Other Canadian banks such as Royal Bank of Canada and Bank of Montreal have also trimmed their workforces due to increased costs in a high-interest rate climate.
The layoffs are partly a response to changing customer banking preferences and the bank’s efforts to modernise and automate certain processes.
Scotiabank anticipates costs of about C$247 million in restructuring and severance, C$63 million for consolidating and exiting certain locations and service contracts, and C$280 million in impairment charges related to its investment in China’s Bank of Xi’an. Scott Thomson, who assumed the role of CEO in February, made leadership changes in August as part of a broader, strategic overhaul set to be unveiled at the bank’s upcoming investor day in December. With around 91,000 full-time working employees as of 31 July, Scotiabank expects its fourth-quarter results to be impacted by approximately 49 Canadian cents per share and a 10 basis point reduction in its common equity tier 1 capital ratio.