Citigroup, HSBC Holdings and Barclays are ordering more staffers to report to company offices five days a week as regulatory changes make it trickier for Wall Street to allow working from home.
Citigroup is requiring about 600 employees previously eligible to work remotely to commute to company offices full-time, the firm said in a statement Thursday. Even then, the majority of staff can continue their hybrid schedules, working up to two days a week outside the office, it said.
At HSBC, shifting regulations affect about 530 staff in New York — roughly half of its workforce in the city — and the bank is speaking to them about their options, Mabel Rius, head of human resources for the U.S. and Americas, said in an interview. The firm is trying to let as many people as possible retain the option of logging in from home if they would like to, Rius said. HSBC’s regional chief has said it can avoid a blanket five-day mandate for all staff.
Barclays will require thousands of investment banking staff globally to spend five days a week in the office or traveling to see clients, beginning from June 1, it said late Thursday in a memo. The decision — after Bloomberg reported the bank was weighing a five-day office mandate for more U.S. staff — coincides with the “new regulatory policies,” it said.
“Being together in the office drives innovation, collaboration and a stronger culture,” wrote Cathal Deasy and Taylor Wright, the firm’s global co-heads of investment banking. “We remain committed to flexible working and we recognize that there will be times when you will need to work from home,” they said, adding that group heads have discretion to allow occasional flexible working where needed.
The banks are known to be among Wall Street’s more flexible in allowing employees to continue working remotely after the pandemic. The changes come as the Financial Industry Regulatory Authority — the brokerage industry’s main watchdog — is set to reinstate prepandemic rules for monitoring workplaces in coming weeks.
That may spell the end of remote work for many bank traders and some other dealmakers, as bosses conclude that allowing the practice under Finra’s framework is not worth the trouble or cost. Firms such as Deutsche Bank have been sizing up the burden as they weigh changes to their own policies.
The number of staff affected by the Finra shift is relatively small compared to the banks’ total headcount, but comprises an outsized proportion of their revenue-generating staff — making it important that banks manage the transition effectively to retain talent. Citigroup has about 240,000 staff worldwide, while HSBC has about 220,000 and Barclays has about 93,000. A large proportion of the banks’ total headcount sits in consumer-facing divisions like local branches or back-office parts of the bank.
With some bosses blaming Finra’s rules for a new slew of five-day office mandates, regulators have shot back, saying that, if anything, they’re trying to allow greater flexibility — not less.
The tension stems from federal requirements that banks monitor staff and facilitate periodic workplace inspections. When Covid-19 broke out, regulators initially eased some of their rules to ensure people could work at home. Some of those accommodations are now poised to sunset.
While Finra says the changes don’t require firms to summon staff to offices five days a week, it has acknowledged that compliance requires work.
Some home offices will have to be listed with regulators as so-called “residential supervisory locations.” A pilot program for those sites lays out a system for remotely inspecting them at least every three years, starting in July. Privately, some executives have said that keeping up with the requirements may amount to a hefty price tag to preserve an employee’s ability to log on from the comfort of home.
Firms may ultimately reach different conclusions. Other banks have been weighing a five-day office mandate for some staff, people with knowledge of the matter said earlier this week.
At Deutsche Bank, executives expect the firm can remain compliant with limited impact on its protocols, according to a person with knowledge of its thinking. Last month, Truist Financial told investment-banking staff that they must work from the office every weekday from June 1.
Some of Wall Street’s largest banks — such as Bank of America, JPMorgan Chase and Goldman Sachs Group — already have embraced five-day office commutes across many of their desks, at least in practice if not as rules. But some smaller franchises have touted flexibility, which can give them an edge in recruiting and retaining talent.
Todd Gillespie, Gillian Tan and Ambereen Choudhury, Bloomberg , 2024-05-28 12:03:05
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