Jobs Cut in Michigan and Ohio
This economic recovery may be the longest since World War II and stocks may be at record levels, but that doesn’t mean all of America’s banks are doing well. Chemical Financial Corporation (NASDAQ:CHFC), the holding company for Chemical Bank, announced plans to shutter dozens of branches and lay off seven percent of its workforce following its recent merger.
In a filing with the Securities and Exchange Commission, the Midland, Michigan-based Chemical Financial said that it is restructuring, closing branches, and laying off seven percent of its employees.
In Michigan and Ohio, Chemical Financial employs 3,500 people. The seven-percent reduction translates into 230 people losing their jobs, most of them in Michigan. Specifically, 20% of the job losses were in the Midland, Bay City, and Saginaw areas.
The restructuring started on September 7, meaning staff were notified that 230 of them would be without work. Those whose jobs have been made redundant will “depart” by September 30.
Leonardo Amat, chief operating officer of business operations and an executive vice president of the company, will be among those departing on September 30. Amat earns a salary of more than $309,000 a year and is paid more than $1.0 million in total compensation.
Some employees who lost their jobs may be re-employed, rehired, or moved to another branch as the company expands.
In addition, Chemical Financial announced that “in response to the evolving banking environment and physical branch overlap” resulting from its merger, “certain branch consolidations” would occur.
This includes the planned consolidation of 25 branches in the fourth quarter of 2017, in addition to the previously announced 13 branches that were consolidated during the third quarter of 2017. Following the planned closures in the fourth quarter of 2017, Chemical Bank will be left with 211 branches.
According to the filing, staff reductions, branch consolidations, and other restructuring efforts will result in pre-tax charges of approximately $18.0 million. Annualized cost savings will be approximately $20.0 million.
Chemical Financial Corporation Merged With Talmer Bancorp
The completion of a merger that triggered the restructuring was announced on August 31, 2016. Chemical Financial merged with Talmer Bancorp, Inc., holding company for Talmer Bank and Trust, in a cash and stock transaction valued at $1.7 billion.
Subsequent to the closing of the merger deal, Chemical Financial (and its affiliates) had $17.2 billion in consolidated assets, $12.7 billion in consolidated loans, and $12.7 billion in consolidated deposits.
Following the consolidation, all Talmer Bank and Trust locations are operating under the Chemical Bank name. After the deal, the new, combined bank became the largest bank headquartered in Michigan with assets of $18.8 billion.
“8-K 2017 Restructuring,” Securities and Exchange Commission, September 12, 2017.
“Chemical Financial Corporation Completes Merger With Talmer Bancorp, Inc.,” Chemical Financial Corporation, August 31, 2016.