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Friday, December 12, 2008

Columbia's Parent Plans to Cut Up to 35,000 Jobs

News summary by MFWire's editors

Bank of America, which expects to complete its purchase of Merrill Lynch before the year comes to a close, plans to cut up to 35,000 jobs over the next three years due to the acquisition and the weak economy. It was not immediately clear how the cuts would affect Columbia Management, BofA's Boston-based investment management arm. (Merrill Lynch, for its part, parted with its asset management unit in 2006, selling it to BlackRock).

Executives at the Charlotte, North Carolina-based bank said the reductions will come from both firms and will impact "all lines of business and staff units," adding that the number of cuts by business line has yet to be determined.

Company officials estimated that the reduction will affect a total of between 30,000 and 35,000 employees and said they will arrive at the final number early next year.
Company Press Release

CHARLOTTE Bank of America Corporation is working on a plan to eliminate a significant number of positions over the next three years reflecting the pending merger with Merrill Lynch & Co., Inc. and the weak economic environment, which is affecting the level of business activity.

While both factors will result in the elimination of positions, the company has not completed its analysis. Bank of America expects to have a final plan early in 2009 and estimates it will project the reduction of approximately 30,000 to 35,000 positions over the next three years. A final number will not be determined until early 2009.

The reductions are coming from both companies and affect all lines of business and staff units. Details as to specific reductions in communities or by business line have not been determined. As many reductions as possible will be made through attrition. Severance and other benefits will be provided for those associates whose jobs are eliminated and who cannot be offered another position.

The reductions are designed to eliminate redundancies created as a result of the merger with Merrill Lynch and to reflect the current recessionary environment.

Bank of America continues to do business actively with all of its client segments. It continues to benefit from a flight to safety, attracting deposits and new client relationships. In addition, the company continues to actively originate loans through all of its credit product lines.

Shareholders of both companies voted to approve the transaction last week and Bank of America is currently targeting a closing on Jan. 1, 2009.

Bank of America

Bank of America is one of the world's largest financial institutions, serving individual consumers, small and middle market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk-management products and services. The company provides unmatched convenience in the United States, serving more than 59 million consumer and small business relationships with more than 6,100 retail banking offices, more than 18,000 ATMs and award-winning online banking with more than 25 million active users. Bank of America offers industry leading support to more than 4 million small business owners through a suite of innovative, easy-to-use online products and services. The company serves clients in more than 150 countries and has relationships with 99 percent of the U.S. Fortune 500 companies and 83 percent of the Fortune Global 500. Bank of America Corporation stock (NYSE: BAC) is a component of the Dow Jones Industrial Average and is listed on the New York Stock Exchange.
 

Edited by: Armie Margaret Lee


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