Spokesperson says cuts were made in "some parts of the business"
City National Bank, the Los Angeles-based lender known for its Hollywood clientele, has made around 100 job cuts in wake of financial setbacks and regulatory penalties.
This latest round of layoffs come after the bank reduced its workforce by 5% in the last quarter, leaving it with around 6,200 employees.
The move also follows a broader trend among regional banks, which have been grappling with the challenges posed by rising interest rates and the regulatory requirement to maintain larger reserves as a safeguard against potential losses on non-performing loans.
In a statement to Bloomberg, a spokesperson for City National Bank said the job cuts impacted “a targeted number of roles in some parts of the business.”
“We regularly review our staffing plans and models to ensure they align with our strategic priorities and allow us to best serve our clients and communities,” the spokesperson said further.
City National Bank, sometimes referred to as the ‘Bank of the Stars’, was acquired by the Royal Bank of Canada (RBC) in 2015 for $5 billion.
It has since tripled its assets to approximately $100 billion by leveraging RBC’s capital markets and wealth-management services to diversify its client base and enter the jumbo-mortgage market.
But this expansion has not been without its challenges, Bloomberg reported, with RBC needing to inject capital into City National to stabilize its financial position.
The bank also recently agreed to pay a $65 million fine after the Office of the Comptroller of the Currency (OCC) raised concerns regarding its compliance with the Bank Secrecy Act, as well as anti-money laundering and fair lending regulations.
Last year, City National reached a $31 million settlement with the US Justice Department after it was accused of engaging in discriminatory mortgage lending practices against the predominantly Black and Hispanic communities within Los Angeles County.
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