Capital One will lay off 163 New Orleans workers
by Jaquetta White, The Times-Picayune
Wednesday March 19, 2008, 7:42 PM
Capital One said Wednesday that it will lay off 163 employees, or about 9 percent of its New Orleans staff, as part of an effort to improve efficiency and cut operating costs.
The credit card issuer and retail banker will cut support staff jobs in a wide range of departments beginning in May and through mid-2009, said Steven Thorpe, a spokesman for Capital One.
Employees were informed of the plans in staff meetings throughout the day Wednesday.
Capital One will also cut 11 jobs in Shreveport and 23 in Houston.
Affected employees will be offered severance packages and will have the opportunity to apply for other jobs within the company, Thorpe said.
The cuts will affect positions in what's known as "deposit services," a catch-all phrase for support staff who handle transactions on deposit accounts and through several departments including bookkeeping and research and adjustments. The cuts affect nearly half of Capital One's 338 New Orleans deposit services employees.
Thorpe said the decision is "the result of advances in technology that improve operating efficiencies."
"This decision is driven by a need to be cost-efficient in a very cost-competitive environment," he said. "To continue to grow and evolve our business, we need to lower operational costs."
Thorpe said he did not know by how much the cuts would reduce those costs.
The layoffs will not affect Capital One bank branches, Thorpe said.
The announcement comes two months after Capital One Financial Corp. said increased loan delinquencies, among other things, would put its 2007 earnings at lower-than-expected levels. At the time, analysts said the lower-than-expected earnings confirmed fears that the subprime mortgage market collapse had spilled into other credit areas.
But Thorpe said the job cuts are not tied to the subprime mortgage crisis.
"I don't think we can draw that link," he said. "I don't think you need to be linking those two issues. That's not related."
Not counting the layoffs announced Wednesday, Capital One employs 1,825 employees in the greater New Orleans area.
The wire dept is part of deposit services.....