Bank of New York Mellon Corp. plans to cut about 4 percent of its work force, or 1,800 people, as record declines in global securities markets hurt profits.
The New York-based company, with more than 6,900 employees in the Pittsburgh region and 43,000 overall, announced plans for the dismissals Thursday.
"It has become clear that we need to take additional steps beyond our merger synergies to reduce expenses, given the current weakness in the global economy," said CEO Robert Kelly in a statement.
"We will take advantage of natural turnover to lessen the impact on existing staff," Kelly said.
At this time, the company is not disclosing either locations or the business lines impacted by the cutbacks, said Ron Gruendl, a BNY Mellon spokesman in Pittsburgh.
In addition to a statement issued yesterday evening, Gruendl said all of BNY Mellon's 43,000 employees received an e-mailed communication from Kelly explaining the reasons for the cutbacks.
Most of the reductions will begin in January and continue through the year, Gruendl said.
Bank of New York in 2006 agreed to acquire Pittsburgh's Mellon Financial Corp. in a $17 billion merger to vault ahead of JPMorgan Chase & Co. as the world's biggest asset custodian.
At the time, the company said it would cut costs by eliminating 3,900 jobs. Those cuts are under way.
Since the merger was completed in July 2007, the company has been mostly adding jobs in Western Pennsylvania after pledging to bring 1,000 to 2,000 jobs here within three years.
As of the end of the 2008 third quarter, the company said its employee count in Pittsburgh was up 845 people since January 2007.
The financial crisis, which began last year when housing slumped and mortgage defaults increased, led to a 49 percent drop in the S&P 500 Stock Index this year, the biggest since the Great Depression.
BNY Mellon's third-quarter profit fell 53 percent after it propped up 10 money funds that owned debt issued by bankrupt Lehman Brothers Holdings Inc. Its investment assets declined 4.1 percent to $1.07 trillion last quarter, and custody assets fell 2.6 percent to $22.4 billion.
As a custody bank, BNY Mellon provides record-keeping and administrative services to clients, such as mutual funds and pension plans. It is one of two clearing banks that enable the purchase and sale of Treasury securities.
Banks and brokerages worldwide have announced more than 166,000 job cuts since the subprime-mortgage market's collapse last year, resulting in losses and writedowns of more than $966 billion.
Citigroup Inc., the second-biggest U.S. bank by assets, will dismiss 52,000 workers in the next year, 15 percent of its work force. Money-management companies such as Fidelity Investments and Janus Capital Group Inc. cut more than 3,700 jobs this year.
BNY Mellon last month said it will receive a $3 billion equity investment from the Treasury. It was one of nine companies selected in the first phase of the government's $250 billion program to inject capital into financial institutions in an effort to stimulate lending.
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