Wells Fargo could cut more information technology staff as part of a companywide efficiency initiative, according to internal communications to employees obtained by the Observer.
In a memo to employees Monday, Wells Fargo said its enterprise information technology group will move in July into the bank’s corporate finance operation. The company is consolidating functions that were spread across various lines of business, according to an undated document answering “frequently asked questions” about the changes.
The documents don’t rule out resulting job displacements.
“People are our competitive advantage, and we will work to minimize any impact to team member positions,” the documents say. “However, we are continually assessing our staffing needs and looking for opportunities to operate more efficiently in the future.”
Asked about possible job cuts in the enterprise information technology unit, Wells spokesman Josh Dunn said: “There are no plans to downsize the team as a result of this move.”
The affected unit, which is being renamed “enterprise finance and information technology,” handles work ranging from support services for the company’s laptops to helping provide online security to customers.
The changes in the IT department are causing angst among workers in the unit, said an employee who spoke on condition of anonymity because he was not authorized to speak publicly on the issue.
San Francisco-based Wells Fargo has already cut technology jobs in Charlotte this year as part of its efficiency initiatives. In January, the bank said it was eliminating 121 technology positions nationwide, including 39 in Charlotte.
The bank is restructuring its IT operations as part of a broader efficiency program unveiled last year. Wells Fargo says the goals of the initiative, called Efficiency and Effectiveness 2020, include reducing complexities and waste, and generating savings the company can reinvest.
Wells Fargo says in the documents that its information technology operations have become “increasingly complex” over time. That complexity contributes to higher costs, increased information security risk and a slower pace for bringing products to market.
“We have a difficult task ahead, but we must change the way we develop, test and manage IT in Wells Fargo,” the documents say.
Wells Fargo said its previous model was not the most conducive for collaborating and also increased security threats, according to documents.
“Large number of applications and lines of code,” the documents say, “results in higher number of vulnerabilities and increased technology risk.”
Since February, the enterprise information technology unit has been reporting to San Francisco-based Chief Financial Officer John Shrewsberry in connection with the March retirement of Minneapolis-based Chief Information Officer Kevin Rhein.
More than 13,300 employees work for the enterprise information technology group across 49 states and nine countries, internal communications show. In North Carolina, the group employs 3,340, more than in any other state. Wells Fargo said all figures are from May 2015 and did not provide updated numbers.
Wells Fargo’s broader efficiency program is designed to find savings the company can reinvest in a variety of areas, including cybersecurity, risk and compliance, as well as new technologies to improve customer experience, a person familiar with the situation told the Observer in May 2015. The five departments under review are human resources, technology support, finance, communications and marketing, the person said.
Wells Fargo employs about 268,600 employees worldwide. In Charlotte, it employs about 23,600 across multiple business lines, making the region its largest employment hub.
The bank’s efficiency push comes as other banks are also seeking to shed costs as they cope with new regulations following the financial crisis and low interest rates constraining their profitability. Charlotte-based Bank of America is looking to streamline processes through an efficiency program called Simplify and Improve, which has led to job cuts in Charlotte and elsewhere.