JPMorgan Chase says it is laying off around 15 percent of First Republic Bank’s roughly 7,200 employees following its acquisition of the troubled bank in a regulator-brokered deal earlier this month.
The bank said it notified workers May 25 of their future employment status, with around 85 percent of the former bank’s workers staying on in full-time or “transitional” roles that could last between three, six, nine or 12 months, depending on the role, with more information about the length of those temporary posts arriving June 1.
It’s not yet clear how many of those laid off are Boston-area workers, but JPMorgan said that the total headcount reduction amounted to between 20 percent and 25 percent fewer jobs than First Republic announced it was cutting in April, and that most of those being cut now had already been slated to receive pink slips before First Republic was acquired.
“Since our acquisition of First Republic on May 1, we’ve been transparent with their employees and kept our promise to update them on their employment status within 30 days,” JPMorgan said in a statement. “We recognize that they have been under stress and uncertainty since March and hope that today will bring clarity and closure. The vast majority of First Republic employees will be offered employment at JPMorgan Chase – either through a transition period, or in many cases full-time. Employees who have not been offered a role will receive pay and benefits covering 60 days and will be offered a package that includes an additional lump sum payment and continuing benefits coverage. We’re also providing resources to help them find new opportunities here or outside the firm.”
JPMorgan Chase has around 13,000 job openings, the company said.
First Republic was a major banker for Greater Boston’s wealthiest, and JPMorgan executives say they hope to leverage this position and similar positions in other major American metros to materially grow the company’s wealth management arm, suggesting it would seek to retain key First Republic talent. But other Greater Boston banks have suggested they are actively looking to hire some First Republic workers, and mergers have historically proven fruitful recruiting opportunities for local banks.
The May 25 layoffs come after North Carolina-based First Citizens Bank said it was letting hundreds of former Silicon Valley Bank workers go, including some Boston workers, creating an additional pool of talent for local banks to chase.