Bank of New York Mellon (BNY Mellon) is looking to axe around 3% of its workforce in 2023, reported Reuters.

The move, first reported by the Wall Street Journal, will lead to 1,500 redundancies.

With a headcount of 51,700 at the end of 2022, BNY Mellon is the latest to plan retrenchments as interest rate hikes jeopardise economic projections and discourage dealmaking.

The layoffs will focus on management positions.

According to media reports, financial services giants including Goldman SachsBlackRock and Credit Suisse are also slashing jobs.

The news comes as BNY Mellon’s net income slumped 38% in the fourth quarter of 2022 to $509m from $822m in the prior year.

Total revenue in the quarter ended December 2022 was $3.9bn, down 2% year-on-year, mainly due to decrease in investment revenue.

Total noninterest expense increased 8% to $3.2bn, driven by higher severance expense.

BNY Mellon said that the net loss from repositioning the securities portfolio and severance costs accounted for $548m during the period under review.

During a post-earnings discussion with analysts, BNY Mellon CEO Robin Vince stated that the company’s spending growth was high.

“We consider that number too high, especially considering the expense growth benefited from a stronger US dollar throughout the year,” Vince was quoted by Reuters as saying.

The firm’s credit loss provisions stood at $20m in the fourth quarter, as against a benefit of $30m in the previous quarter, reflecting “changes in the macroeconomic forecast”.

Assets under management plummeted 25% to $1.8tn, hit by lower market values, the impact of a stronger US dollar and the sale of Alcentra to Franklin Resources.