UMB’s cost cutting includes layoffs

A push to cut costs has led to layoffs at UMB Financial Corp., though the Kansas City-based banking company isn’t saying how many lost their jobs.

In a presentation to investment analysts Wednesday, UMB cited reductions in employees, elimination of vacant jobs, and cutbacks in overtime and hours worked as part of its effort to make the company more efficient.

Chief executive Mariner Kemper declined to say in an interview how many jobs were eliminated or how many employees were laid off. But he said they came throughout the company and, like other cost saving moves, did not hurt the company’s ability to serve customers or do business.

“We were inefficient. We were putting more people against the business than we needed to,” Kemper said. “So we took action to improve.”

Severance costs from the job cuts at UMB will total $8 million this year and next, the presentation showed. Employees losing jobs have been notified, but the expenses aren’t recorded until the individuals sign out with their severance benefits.

Other efforts to cut costs included simplifying the reporting structure at UMB, improving efficiency within branches, reducing advertising, pulling less profitable ATMs, renegotiating some vendor contracts and eliminating others, and modernizing technology.

UMB held the conference call after reporting Tuesday afternoon that its third-quarter profit was down 37 percent. The drop reflected some one-time costs, including $4.5 million tied to integrating Marquette Financial, which UMB acquired.

Kemper said he is happy with the growth in most of UMB’s businesses, with increases in loans and growth in its health care accounts business and mutual fund servicing operations. Its Scout mutual fund group is lagging.

“There are no holes in our strategy right now,” Kemper said. “We feel pretty good about the future. We just need to get really focused on dropping more money to the bottom line.”

This story was originally published October 28, 2015 at 11:45 AM with the headline "UMB’s cost cutting includes layoffs."