Bank of America said yesterday that it planned to cut 30,000 to 35,000 positions - among the largest layoffs ever - over the next three years as it digests its acquisition of Merrill Lynch. That could amount to more than 11 percent of the combined firms' global work force of 308,000.
Combining two firms as large as Bank of America and Merrill often involves eliminating duplicate jobs. Both have significant overlap in areas like research and investment banking.
But Bank of America, based in Charlotte, N.C., acknowledged that this round also reflects the dismal economy. The firm said the layoffs would cut across all of its businesses, and that a final number would be determined early next year.
Many of the jobs will be lost through attrition, Bank of America said, though a spokesman declined to comment on specifics of the plan, such as which offices will be affected and which businesses will see job reductions.
Wall Street's pain is unlikely to stop there. After years of rapid growth, built largely on the trading of risky securities like subprime mortgages, the financial services industry is in the throes of its sharpest contraction in modern times. As of last week, banks have cut 186,439 jobs since the onset of the financial crisis in July 2007, according to data from Bloomberg News. Bank of America has already laid off 11,150 employees, while Merrill has cut 5,720.
Bank of America is the largest bank in the Baltimore area, with 106 offices and $12.5 billion in deposits, according to the latest information from the Federal Deposit Insurance Corp. The bank doesn't release state-by-state employment figures, but reportedly employs a total of 247,000 workers. Merrill Lynch has 60,900 employees worldwide, according to its Web site.
Bank of America, whose stock has fallen 64 percent this year, sealed its shotgun marriage to Merrill last week, creating a colossus of both corporate and consumer finance. But the firm, like its peers, has taken billions of dollars from the government to confront a recession that poses serious threats to many of its businesses. Banks are already reeling from losses tied to credit card debt, auto loans and commercial real estate mortgages, and analysts worry that more consumers will struggle to stay current on the debts they had in more profitable times.