Under Pressure To Cut Costs, Wall Street Banks Downsize

Many banks report earnings this week. Bank of America turned in a loss after taking a big charge for legal expenses. Citigroup will lay off about 300 stock and bond traders in an effort to cut costs.

KELLY MCEVERS, HOST:

NPR's business news starts with losses on Wall Street.

(SOUNDBITE OF MUSIC)

MCEVERS: Many banks are reporting their first quarter earnings this week and the results have been mixed. Bank of America turned in a quarter of a billion dollar loss, while Citigroup says it will lay off as many as 300 stock and bond traders to cut costs.

WNYC's Ilya Marritz reports that Wall Street as we've known it is shrinking.

ILYA MARRITZ, BYLINE: You can see signs of it all over. Last fall, JPMorgan Chase sold a 60-story tower near the stock exchange. Dilip Brua has a fruit stand there.

DILIP BRUA: They sold this one and I lost customers. And now, it's very slow.

MARRITZ: So there's less people coming to you?

BRUA: Less people.

MARRITZ: It's part of a bigger trend. Banks are under pressure to cut costs, due partly to new regulations, so they're shedding real estate, and moving jobs to cheaper locations, like Pittsburgh, Baltimore, and Jacksonville.

Improvements in technology mean it really is possible to do IT or human resources remotely. Even stock and bond traders may find their jobs are not safe, according to James Malick. He's a partner with Boston Consulting Group, who helps banks outsource and downsize.

JAMES MALICK: As trading goes electronic, as things that formerly were done voice-to-voice, now it's two computers, you no longer need those people to do those jobs because they're being replaced by machines.

MARRITZ: Twenty years ago, New York claimed nearly one in three jobs in finance. Today, it's fewer than two in 10.

For NPR News, I'm Ilya Marritz in New York.

Copyright © 2014 NPR. All rights reserved. Visit our website terms of use and permissions pages at www.npr.org for further information.

NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.