Scotiabank To Cut 3% Of Staff Globally
Scotiabank (TSX: BNS) is expecting a rough fourth quarter financially, disclosing this morning that it will be taking several charges as it looks to right size its operation.
First and foremost, the company anticipates a restructuring charge of $247 million to be taken during the quarter on a post-tax basis, which relates to workforce reductions of 3% globally. The reductions, which are not believed to have been previously disclosed, is a result of end-to-end digitization, automation, and a change in day to day banking preferences among consumers.
As of July 31, Scotiabank had 91,013 full time equivalent employees, meaning a 3% reduction would amount to an estimated 2,730 jobs.
At the same time, the company will see post-taxes charges of $63 million related to the consolidation and exit of certain real estate locations and service contracts. Savings from both efforts are expected to be achieved through fiscal 2024.
READ: Scotiabank Falls Short Of Q3 2023 Earnings Estimates
Separately, an impairment charge of $280 million related to an investment in Bank of Xi’an Co Ltd is also expected to be taken during the quarter, as a result of the market value remaining below the carrying value for an extended period of time.
The total impact is said to be $590 million on an after-tax basis, or $0.49 per share.
Further details are slated to be provided at the time of release of the firms fourth quarter results.
Scotiabank last traded at $59.95 on the TSX.
Information for this briefing was found via Cedar and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
As the founder of The Deep Dive, Jay is focused on all aspects of the firm. This includes operations, as well as acting as the primary writer for The Deep Dive’s stock analysis. In addition to The Deep Dive, Jay performs freelance writing for a number of firms and has been published on Stockhouse.com and CannaInvestor Magazine among others.
