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Wells Fargo continues branch-closing initiative with two in N.C., 24 overall

Wells Fargo continues branch-closing initiative with two in N.C., 24 overall

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Wells Fargo’s nationwide branch closing count since mid-July has reached at least 498, with at least 28 in North Carolina, including two locations in Greensboro and one in downtown Winston-Salem and in Dobson.

Latest Wells Fargo branch-closing step claims two in N.C., 24 nationwide

Wells Fargo & Co. is closing another 24 branches, including one each in Chapel Hill and Morehead City, in the latest phase of a multi-year nationwide initiative.

The U.S. Office of the Comptroller of the Currency on Friday listed Wells Fargo branch closings in 12 states and District of Columbia.

Wells Fargo’s nationwide branch closing count since mid-July has reached at least 498, with at least 28 in North Carolina, including two locations in Greensboro and one in downtown Winston-Salem and in Dobson.

The previous closing rounds involved: 21 on March 5; 19 on Feb. 26; 21 on Feb. 13; 50 on Dec. 18; 20 on Dec. 5; 21 on Nov. 28; 73 on Nov. 17; 20 on Nov. 10; 25 on Nov. 4; 43 on Oct. 21; 26 on Oct. 5; 45 on Sept. 30; 21 on Sept. 18; 27 on Sept. 2; 21 on Aug. 4; and 21 on July 21.

In January, the bank unveiled an $8 billion expense-reduction plan expected to take up to four years to complete.

Much of the savings involves eliminating management layers, making additional branch and workforce cuts, and reducing by up to 20% its office space by the end of 2024.

The bank said it has more than 250 “efficiency initiatives” involved in the restructuring.

However, analysts don’t expect the initiative to result in Wells Fargo exiting this year the $1.9 trillion asset cap set by the Federal Reserve since Feb. 3, 2018.

Wells Fargo has been facing investor and political pressure over its response to regulatory orders addressing its fraudulent customer-account scandal that surfaced in September 2016.

Cost-cutting steps

Nearly half of the $8 billion goal, or $3.7 billion in annual cost savings, is projected to be achieved in fiscal 2021.

Some of the cost-cutting steps began in 2020, such as:

Eliminating “one to two layers of management across business and functions” since May.

Closing 329 branches with plans to close another 250 during 2021.

Wells Fargo has dropped from about 6,600 branches in 2009, when it acquired a collapsing Wachovia Corp. and gained an East Coast presence, to 5,032 as of Dec. 31.

The 2020 branch closings reduced the bank’s branch workforce by 20%.

Wells Fargo listed having 268,531 employees on Dec. 31, down from 274,931 on Sept. 30 and from 271,924 on Dec. 31. 2020.

From the third to fourth quarters, there was a 6,482 reduction in consumer banking/retail jobs to 125,034, along with 1,681 in commercial banking to 22,410, 714 in wealth and investment banking to 29,515, and 27 in corporate and investment banking to 8,178.

There was a net gain of 2,504 in the corporate workforce to 83,394.

Other cost-cutting steps cited by Scharf included:

Increase automation of home-lending services

Shrink from 13 to six commercial banking-lending platforms which also will contribute to cutting job positions

Reducing its 46 million square feet of office space by up to 20%, or by 9.2 million square feet, by the end of 2024

Some of the reduction is related to what the bank calls underutilization because of COVID-19 work-from-home policies.

Altogether, Wells Fargo said 35% of the cost savings would come from organizational structure optimization, 20% from branch closings, 14% from consumer-lending changes, 13% from commercial banking changes, 10% in the “other” category, and 8% from reducing its office space.

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@rcraverWSJ

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