Laurentian Bank announced it will cut roughly 10% of its workforce over the next 12 months as the Montreal-based lender reported a 32% drop in financial first quarter profits.

The bank said Wednesday it is “streamlining certain back-office functions,” largely related to supporting its retail services operations.

“Overall, these actions are expected to reduce headcount by approximately 10% or 350 employees through attrition, early retirement and targeted job reductions over the next 12 months,” it said in a statement.

“On an ongoing basis, we expect this will generate cost savings to improve our efficiency.”

The cuts come as Laurentian reported a steep drop in first-quarter profits on lower capital market revenue, stemming from volatility seen on North American stock markets late last year.

The bank reported first-quarter net income of $40.3 million, down 32% from the same period a year earlier. Its earnings for the quarter ended Jan. 31 amounted to 88 cents in diluted earnings per share, down from $1.41 one year ago.

On an adjusted basis, Laurentian reported net income of $44.7 million or diluted earnings per share of 98 cents, down from $63.2 million or $1.49 per share a year ago.

Analysts on average expected adjusted diluted earnings of $1.29 per share, according to those surveyed by Thomson Reuters Eikon.

Laurentian chief executive Francois Desjardins said the bank’s performance this quarter was impacted by “lower capital market revenue.”

“Nonetheless management remains committed to achieve mid-term targets and ultimately, create long-term value for its shareholders.”

He added that Laurentian “has never been in a better financial position, in terms of its solid capital and liquidity levels.”

“And even if there is more work to do, it has never been stronger in terms of its processes and technology,” Desjardins said.

Laurentian has over the years taken steps to streamline its organization, including merging several of its branches. The bank said Wednesday the conversion of its retail branches to advice-only branches is expected to be completed by the end of 2019 as it moves towards its goal of achieving a profitability level similar to other Canadian banks by 2022.

The bank’s latest results marked the third consecutive quarter that it reported a significant earnings miss, said Scott Chan, an analyst with Canaccord Genuity.

“We view the results as low quality with revenue down 9%, year over year,” he said in a note to clients.