No specific layoffs are announced, but Moynihan says units likely to downsize include consumer banking.
Bank of America plans more belt-tightening in 2011, likely meaning more job cuts ahead at the nation's biggest bank and one of Charlotte's biggest employers.
Chief executive Brian Moynihan told analysts on Friday that the bank will be more aggressive in cutting costs as the year goes on, although he said the bank is still adding jobs in growth areas and keeping thousands of extra workers to deal with loan modifications and foreclosures.
The company didn't announce any specific layoff plans, although Moynihan listed a number of business units where the bank would look to reduce headcount, including the consumer banking business and the mortgage area over time. He said the company will be careful not to disrupt efforts to help struggling borrowers and improve risk-management practices.
Bank of America has about 15,000 workers in Charlotte.
"We've got to bring the overhead in this company down," Moynihan told analysts after the bank disclosed a $1.6billion fourth-quarter loss, adding: "We'll continue to focus on it across the company broadly."
Bank of America is one of many financial companies trying to cut costs as revenue dwindles in a sluggish economy and as financial reform crimps once-lucrative fees. Wells Fargo on Wednesday said the bank is working on cost-cutting initiatives, while American Express said it was eliminating 550 jobs worldwide and closing a call center in Greensboro.
"In certain lines of business, banks see the writing on the wall," said Bart Narter, senior vice president in the banking group at consulting firm Celent. "The writing on the wall is they are going to have less revenue."
For banks, that means reducing costs by closing branches, cutting workers in back-office positions such as technology and operations, and encouraging customers to use lower-cost services such as ATMs and online banking, Narter said.
Banks also are looking for additional revenue sources, including charging fees for packages of multiple banking products.
Bank of America has taken many of these steps, including rolling out a new e-banking product and trimming its work force. In September, the bank said it was eliminating a "few hundred" jobs in its global banking and markets unit. And last month, it confirmed plans to cut a "small percentage" of workers in its global technology and operations unit as part of an effort to streamline and centralize operations.
According to Friday's earnings report, the bank's overall employment increased by about 3,900 to 286,951 full-time workers in 2010. But that number included a lot of moving parts.
During the year, the bank added about 13,000 workers to handle modifications, foreclosures and debt collections in the mortgage unit, Moynihan said. Bank of America also hired about 2,000 people in investment banking and wealth management positions, about half overseas. That means the rest of the company was down about 10,000 to 12,000 positions, he said.
Bank spokesman Jerry Dubrowski said the reductions included previously disclosed layoffs, natural attrition and job cuts announced in 2008 related to the Merrill Lynch merger and the recession. Going forward, the bank can cut costs by trimming a variety of expenses, not just personnel, he said.
"We will continue to invest in businesses in which we see growth opportunities," Dubrowski added.
The mortgage unit, bulked up by the 2008 acquisition of troubled lender Countrywide Financial, now has about 55,000 employees. In three years, if foreclosure and modification tasks decline, that number could fall to 30,000 to 35,000, Moynihan said.
The credit card and deposits businesses are also targets for cost cuts, he said. In 2010, for example, the bank's total branches declined by about 150 to about 6,000.
In the global banking and market units, Bank of America has been boosting bankers in Asia and Latin America as it looks to reap more fees from helping companies in faster-growing markets raise capital and forge mergers. At the same time, it has been scaling back in the U.S. and Europe.
The wealth and investment management business added 500 to 600 financial advisers and private bankers in 2010, and Moynihan plans to continue hiring in that unit, which includes Merrill Lynch stock brokers. He called the business the company's best U.S. growth opportunity as it targets the investing and banking business needs of affluent customers.
In an interview, Chief Financial Officer Chuck Noski said the bank is essentially taking lessons from mergers - cost-cutting, efficiency improvements and revenue initiatives - and applying them to the current company.
He said the bank hasn't launched an overarching cost-cutting program, but "in each of the businesses there are pretty active initiatives to be more efficient."
Bank of America has slashed its work force numerous times in recent years. In December 2008, the bank said it planned to eliminate 30,000 to 35,000 employees over three years as part of its Merrill deal and in light of economic conditions.
"We know how to take out costs," Moynihan said. "We've done it many times before, and we'll continue to do that."
Wells Fargo, which has about 20,500 employees in Charlotte, has said in recent quarters that it's also looking to cut costs by streamlining processes and eliminating redundancies.
"While some staff reductions could result, that certainly isn't the only way to achieve those goals," Wells spokeswoman Mary Eshet said.
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