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Bank of America’s Job Cuts Offer a Road Map for Navigating Higher Costs

  • Shrinking headcount helps keep expense growth in check
  • Banks stocks with surprisingly high expenses get pummeled
The Bank of America Tower in New York.

The Bank of America Tower in New York.

Photographer: Amir Hamja/Bloomberg

The biggest U.S. banks received a clear message in recent days: Runaway expenses won’t cut it.

Lenders that reported higher-than-expected costs, including JPMorgan Chase & Co., Goldman Sachs Group Inc. and First Republic Bank, had their shares pummeled by investors. Bank of America Corp., on the other hand, showed companies a different way to manage costs despite rising inflation, a war for talent and soaring tech spending.