MUFG Weighs Cutting Americas Office Space in Hybrid-Work Era

Mitsubishi UFJ Financial Group Inc. is considering ways to reduce its real estate footprint in the Americas while preparing for a post-pandemic world in which many workers come to the office just a few days a week.

The lender anticipates that roughly 25% of workers in the region will be fully remote after the pandemic and another 25% will come into the office every day, said Jon Lindenberg, head of Americas corporate and investment banking. The rest will probably stay home some of the time and operate from a shared desk when they do go into the office. The bank has about 13,900 employees in the Americas.

“That allows us to think about what our real estate footprint might look like in a post-pandemic environment,” Lindenberg said in an interview. “When you add all that up, I think it does translate into an ability to reduce footprint.”

Wall Street sent many workers home in droves last year to stem the spread of the coronavirus. Now, with the U.S. in the midst of the largest-ever vaccination campaign, many large employers are planning to bring workers back to offices, with some set to offer the option of remote work on a permanent basis. JPMorgan Chase & Co., for example, expects the bank’s future need for real estate to drop significantly, requiring some 60 seats for every 100 employees as some staff work under a hybrid model, it has said.

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With most workers still at home for now, MUFG has been encouraging top managers to check in on their employees, especially junior bankers and analysts.

“We’ve asked that our analysts and associates receive sort of a higher level of mentorship and contact from their mentors within the organization who are responsible for training and developing them,” Lindenberg said. “But it’s still a poor substitute to in-person.”

The Tokyo-based firm has sought to recreate some of the office experience, such as stopping by the pantry for snacks, by sending YETI tumblers to workers and encouraging managers to ask employees about topics other than their jobs.

“We’re trying to keep the camaraderie,” Lindenberg said.

Lindenberg, who assumed his new role recently, said the firm’s continuing to focus on building out its supply-chain finance business, which pays a company’s suppliers the value of outstanding invoices minus a discount. The bank later collects the full invoice amount from the buyer and profits from the spread.

MUFG has been looking to grow in the area since it announced the 2019 acquisition of Trade Payable Services, a supply-chain finance platform, from General Electric Co.’s financial-services arm. The lender is also weighing how it can use distributed-ledger technology in the business.

“There is considerable value for distributed-ledger technology and blockchain in general,” said Maureen Sullivan, head of supply-chain finance for MUFG in the Americas. “There’s tremendous cost savings in digitizing the enormous amount of paper flows.”

The firm is hoping to persuade more existing clients to use the supply-chain finance and other working-capital offerings. The bank has tried to stay connected with clients in different ways during the pandemic, and has even tried out a virtual wine tasting.

“It was really, really fun,” Lindenberg said. “I don’t know what was happening off camera, but it was really fun on camera.”

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