Bank Of America To Cut 30,000 Jobs As Part Of Restructuring Plan (VIDEO)

NEW YORK -- Bank of America will cut about 30,000 jobs over the next few years in a bid to save $5 billion per year. The cost-cutting drive is part of a broader effort to reshape and shrink the nation's largest bank as it copes with fallout from the housing bust.

The bank announced the job cuts in a statement shortly after Brian Moynihan, the bank's CEO, disclosed the cost-saving goals in an address to investors in New York. "We're a much simpler company than we were 24 months ago," Moynihan said.

Bank of America stock was up 2 cents at $7 at midday. The stock has lost half its value this year, largely over problems related to poorly-written mortgages it acquired with its 2008 purchase of Countrywide Financial Corp. The bank faces lawsuits from investors and regulators over the sales of mortgage-backed securities that lost value after the housing boom collapsed.

The job cuts follow a revamp of the bank's top management team last week. Two senior executives, wealth management head Sallie Krawcheck and head of consumer banking Joe Price, left the bank. The bank also elevated commercial banking chief David Darnell and investment banking head Tom Montag to co-chief operating officers, reporting to Moynihan.

The latest job cuts will lead to a 10 percent reduction in the bank's work force of 288,000. The cuts come on top of 6,000 positions the bank has already eliminated through the third quarter of this year.

The Charlotte, N.C. company said it expects many of the cuts to come through attrition and eliminating unfilled positions. The bank says the number of job cuts isn't fixed, but that it expects they will total 30,000. It hopes to save $5 billion in annual costs through 2014 under a cost-cutting plan dubbed internally as "Project New BAC."

Comments

[Brian D Powers]

09:29 PM on 10/27/2011

What will these "Job Creators" tax cuts add up to this year? How much of these profits will be funneled into our government in bribery? Who pays for the unemployment benefits for these victims of corporate power. 30,000 familiesthrown into chaos for corporate profit. A genocide of jobs.

[Alex Croley]

07:40 PM on 10/27/2011

First take the money out of circulation by taking tax breaks (to stimulate job growth), and then take tax-payers out of circulation (to stimulate saving money). Its a nice plan to take Billions of Dollars out of circulation and under a pillow somewhere in Sweden.

[Rantibus]

05:40 PM on 10/26/2011

Project New BAC? Project Cash Back - right into the executive's pockets...

[rebootpolitics]

03:54 PM on 10/26/2011

Don't forget folks, Bank Transfer day (AKA 'Fire you bank' day) is November 5th:

http://www.facebook.com/Nov.Fifth

[doug sil]

07:05 PM on 09/29/2011

they already have the keys to "The United States Treasury". Open that sucker up and hire 30,000 people and make up for the economy you helped crash.

[doug sil]

06:42 PM on 09/29/2011

all of this to give moynihan a fatter bonus. Down with the "to big to fail banks" go to a local credit union and put these dinosaurs out of business!!

[Seymoreclearly]

05:05 PM on 09/29/2011

Hmmm, banks charge overnight interest to "park" monies moving thru the financial system, whether via wire or ACH. Banks also charge both the swipe side AND the customer side for the use of debit cards, something which they have brought into being & have made so indispensible. And they make money in other ways, too.

They also pay some of the crappiest salaries to their rank 'n file, so if we do some math, say 30K employees times 30K avg annual salary (and I'm being VERY generous here) that equals $900 million/yr.

Question: If they're a publicly-traded company, how much in yr-end bonuses will the BofA CEO & other senior executives get this year? I mean, if 30K people are going to be unleashed on an already over-crowded jobs market, why should their executives profit by taking away the livelihoods of those people?

So they cost the American taxpayers how much in bailouts & now they'll cost us even more......

[citygirl1832]

04:57 PM on 09/29/2011

How could they be cutting jobs????? I thought they were the JOB CREATORS.

[cccoyote]

04:54 PM on 09/29/2011

The job slashers-

http://www.bizjournals.com/charlotte/blog/bank_notes/2011/02/bank-of-america-ceo-brian-moynihan.html

"Moynihan will receive a $9 million all-stock bonus for his work in 2010, the bank said in a securities filing Monday.

In addition, Tom Montag, head of the bank's trading and markets business on Wall Street, will receive $14.3 million in a stock bonus. Joe Price, head of consumer banking, and Chuck Noski, BofA's CFO, will both receive $4.8 million in stock bonuses.

Moynihan, appointed CEO on Jan. 1, 2010, did not receive a cash bonus. The three other executives each received $900,000 cash bonuses, according to the filing.

Top executives also will see a raise in 2011, according to the filing. Noski, Price and Montag will all see a $50,000 raise in annual base salary, taking their base pay to $850,000 annually. That's an increase of more than 6%...."

[la fourchette]

04:53 PM on 09/29/2011

I keep hearing the cry that the private sector is our only hope. The claim is that if only the government would get out of the way of the private sector and de-regulate, cut taxes and let them have free reign, they will save us from this precipice.

In reality, they line their pockets with tax cuts and record profits after handouts but job creators?

Errrr....Not so much.

[Indra]

04:48 PM on 09/29/2011

They always were a sleazy organization.

[profco]

04:29 PM on 09/29/2011

Perhaps this is what Bank of America's Director of Public Policy, James Mahoney, meant when he whispered to Rick Perry, "We will help you out" back in mid-August.

If every new job created through Obama's plan or small steps toward economic recovery is offset by layoffs in the private sector--Bank of America is now mulling more than three times the number of job cuts originally proposed--every step forward will be two or three steps back.

Bank of America founder A.P. Giannini would be disgusted with the financial Frankenstein he brought into being, originally by helping new immigrants and "the little guys."

[Daedalus22]

04:24 PM on 09/29/2011

When will people learn that banks--and bankers--are not our friends and they only see us as wallets to be plucked? Someone else commented why not go to a local credit union instead? Good idea. Banks contributed mightily to the financial debacle gripping the nation and now those with debit cards are going to be forced to pay for their greed. And, oh yes, they got bailed out but not the homeowners they screwed or the rest of us who have seen the prices of our houses drop by 40 percent in some markets. BOA is not a 'simpler' operation--they are still a greedy bank driven by profit before service. And that is what is primarily wrong with most American businesses.

[x27]

03:59 PM on 09/29/2011

BOA..H....

[Roberto Profuncto]

03:55 PM on 09/29/2011

I can only laugh.
If you do business with BofA (aka BunchofA sssholes) then you deserve every penny you lose through them.

For the life of me, I can't figure out why BofA, Citi, Wells Fargo, Chase, etc. are still in existence, unless their depositors are just too lazy to walk across the street and open an account at their local CU.

[Seymoreclearly]

05:16 PM on 09/29/2011

I have a 30+ yr old grudge against them when they lost a small deposit of mine back in 1979 ($30 to cover 3 utility bills, how things have changed...) & bounced 3 of my checks. Back then bad check fees were something like $10 per hit (again, how things have changed) so they ended up costing me $30 in addition to having to cover the checks I had already covered with my deposit AND pay those bills again. This was back in the days when we didn't carry debit cards for quick transactions. This was back before we even heard of computers. Not to mention what I had to pony-up to the utility companies in penalties.

This was back when I made $4.20/hr. That was $168/wk before taxes, $120 after.

When I couldn't resolve the situation with the tellers, I went to the VP. This executive finally looked at me & asked rather imperiously, "Must you bother me with this again?" Nope. I simply paid the charges & took my business elsewhere.

Over the past 30-odd yrs, I don't believe much has changed at BofA. Take your money elsewhere.