Northern Trust Corp., the third- largest independent U.S. custody bank, will eliminate about 700 jobs to join its biggest rivals Bank of New York Mellon Corp. and interest rates hobble profit.
The move brings cutbacks made or planned by custody banks over the past 13 months to 4,450.
BNY Mellon, the largest custody bank, said last year it would eliminate 1,500 positions, and State Street has planned 2,250 job cuts since November 2010.
Federal Reserve’s decision to keep its main lending rate close to zero has eroded margins on lending and investments for custody banks and forced them to waive fees on money-market funds. Volatility in global equity markets, which fell 9.4 percent in 2011 as measured by the MSCI ACWI Index, also hurt profit.
Full story: Northern Trust Cuts 700 Jobs – Bloomberg