How low does the number of employees need to get for him to be happy with it? Or let me rephrase that, how low does the number of American employees need to get for him to be happy with it? We've had major layoffs near constantly, attrition is highest ever, and he still doesn't seem satisfied. When will it be enough?
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With all due respect, the efficiency ratio cannot go down unless expenses can be reduced, and with our 30 years out of date technology there is no way to compete efficiently without a great deal of investments in technology. You cannot grow enough revenues to make up for the costs of archaic technology.
We are entering our end state of peeling away LOBs to sell to FinTechs. In other words we are being gracefully unwound and the entire U.S. Banking System is waiting until we can all exhale.
Touché… this is exactly why our regulators are trying their best to wind us down gracefully. Wells, along with our 25 years of nonstop scandal and corruption, is currently the greatest systemic risk to our banking system
We need to be unwound gracefully and sold in pieces to Fintechs.
Period.
Charlie bringing in highly paid extra-JPM execs will surely improve the efficiency ratio.
Schart’s goal is always the same. Vest the options, squirrel away the bonuses and salary and as the lack of progress continues… focus on the exit and the next lucrative opportunity.
To be fair, I can only personally vouch for this for his last 4 CEO gigs. But this current one clearly maintains the pattern.
I’m, they have clawback/income disruption insurance as part of the dam contracts now. It’s a total sham the rank and file pay for.
Once he moves enough jobs overseas to meet expense ratio targets and pad his bonus. I'm sure he wants to have plenty of extra cash just in case another 5 scandals pop up and half his comp gets clawed back.
Wouldn't giving up our commercial space reduce expenses? Do everything but the obvious. My old team is currently using contractors to get caught up on work instead of filling a position. The contractors are making more money and have higher titles than the two employees approving their work! My old team members are pi---d to say the least. So many bass-ackwords things at WF!
His goal is to exploit slave labor , wether India / Phillipines and enrich himself and C-suite goon squad who are on his side.
His goal is to get the asset cap lifted. Duh.
Some good points here, but I believe that the reason the efficiency ratio is so high is because the company has under-invested in technology for so long. This results in many tasks that are needed to be performed manually, making it harder for many back office areas to be laid off without a negative impact to operations.
Revenue per Employee... Check out CSI Market for this metric.
We have the lowest in the industry. The only way to change this is to increase revenues or to decrease employees.
Increasing revenues at the moment is a challenge due to the asset cap. So this leaves decreasing the number of employees.
Efficiency ratio has two components, expenses and revenue. Ratio would go down if revenue went up and expenses remained the same. It's the revenue side ki----g us. We make most of our money on assets (loans) and with the asset cap in place it has throttled revenue. Cuts and more cuts still won't get that puppy under control without revenue increases as well.
I believe there needs to be roughly 50,000 more people laid off before Wells is in line with competitors. There’s been too many LOBs for years that beat their time in and very inefficient and too many middle layers of management that need to go.
You are missing the point. To be fair, that is not his goal. If you look at all the other major banks, and then look at Wells Fargo, our efficiency ratio is unbelievably high. That is unsustainable. Just look at our 1st quarter earnings and presentation. It is not that Charlie is a mean guy. We have to become competitive to survive. Sure there are costs other than payroll that can be reduced, without a doubt. Growing revenue will help, but it is obvious, reducing payroll costs is necessary.
Charley isn’t here to build morale, or employee engagement, or encourage seasoned professionals to continue growing & learning. He’s chopping Wells up but by bit, shipping jobs overseas, laying off good employees, with the goal of driving attrition and lowering headcount. When the consent orders are lifted, you’ll see more layoffs because profits matter more than the people who have worked their as--s off trying to keep Wells afloat. This is the perfect example of years of poor leadership but the employees pay the price.
He doesn’t have a specific number in mind as he is not here for the long term. Cash out and move on to his new gig or retire. He has more than enough $$$.