Bank of America layoffs could reach 30,000

[FarCenter]

As they work to complete the first phase of a major efficiency program, Bank of America Corp. executives are discussing plans that could slash the companywide workforce by much more than 10,000 jobs, sources familiar with the matter said.

The Charlotte-based bank could potentially shed 25,000 to 30,000 jobs over several years, the sources said. The bank hasn’t said how many jobs will be eliminated in the efficiency campaign, although some reports have said the number could reach 10,000. Executives are still working on final plans.

Broader cuts would be similar to London-based HSBC’s plan to eliminate 30,000 jobs, or about 10 percent of its workforce. At the end of June, Bank of America employed about 288,000 workers, with about 15,000 in its headquarters city. A 30,000 reduction would equate to a little more than 10 percent of the employee base.


Read more: http://www.charlotteobserver.com/2011/09/02/2574344/bank-of-america-layoffs-could.html

Banks Swamped by Loan Refinancing Surge

“All of a sudden now we see a smaller universe of people handling the volume,” Walters said. “So what’s happening is when the volume hits, people hit capacity much quicker.”

Bank of America Corp. (BAC) said Aug. 31 that it plans to sell or shut its correspondent-mortgage unit, which buys loans from smaller companies, a move that may exacerbate the crunch. Earlier this year, the Charlotte, North Carolina-based bank joined lenders across the industry in cutting staff added during a refinancing boom that crested in October.

In April, Wells Fargo, based in San Francisco, said it aimed to cut 4,500 employees from its mortgage unit, and Bank of America, its biggest competitor, said it trimmed its mortgage workforce by 1,500 employees and 2,000 contractors.

http://www.bloomberg.com/news/2011-09-02/banks-in-u-s-overwhelmed-by-mortgage-refinancing-boom-after-reducing-jobs.html

[bkkyosemite]

1. Next we will be hearing about how many jobs from B of A

have been relocated for efficiency out of country!

[bkkyosemite]

2. We need to let them put their Corporate Offices in China,

South American and India and not let them back in. Then open our own companies made in America. These corporations are leaving us behind. We will not have a workforce at all unless we kick them out and start with those who really want a good company that has great employees and well made products. To hell with these pigs. (there I go again for some reason tonight I like that word pigs)..

[Ilsa]

6. We need more than that. We need to either

eliminate interstate banking or re-regulate, with teeth, to prevent any one bank holding company from taking more than a certain percentage of the market.

The statistic from the end of Too Big To Fail indicated that 77% of banking assets in the US are held by the top ten banks. We need to make certain they are no longer too big to fail so that we can let them fail when they mismanage themselves.

[otohara]

3. and OUTSOURCING

they always fail to mention that.

[FarCenter]

4. One reason for outsourcing is that it is easier to automate and close down

Closing down a bank operation in the US is messy. If you first outsource it, it is easier to automate the operation since there is no internal resistance to doing so. Once the operation is automated, the outsourcing contract can be easily terminated.

[BR_Parkway]

5. Break them up and make banking inside state lines again - won't need

to eliminate all those jobs

Has side benefit of not allowing them to remain Too Big To Fail

[Ilsa]

7. I'm with you on this.

Interstate banking killed tens of thousands of good-paying jobs, too.

I watched it all unfold. I started in banking in 1980 and survived 13 years, watching real estate lending criteria disappear, and the typical high-risk lending follow. I survived by working in a huge workout bank, indirectly for the FDIC for many years.

[MilesColtrane]

8. Anyone who can read a balance sheet can tell you that this company is DONE.

Dead, but still walking around...

If you work there, or have any money there, you're going to be in for a rude surprise when it collapses, and this time there won't be the political will to bail it out.

[newblewtoo]

10. Why did Buffett just invest 5 Billion?

Is he getting senile ? Sounds like you may have a different view, would you care to share (if you are can )?

[MilesColtrane]

13. He's making a bet that the government will bail out BAC if it implodes.

...and, not a large bet at that.

Buffet's $5 billion purchase of preferred BAC stock is a gamble of just 2% of his company's capital.

He is, however, heavily invested in financial companies overall (around 40% of his portfolio). His two percent investment in BAC not only gives Bank of America a little badly needed capital, it also buys a lot of influence on how other investors view financial stocks right now.

There is a halo effect around Buffet's investments. The market pays attention. Investors see this move and they will think twice about shorting companies like Wells Fargo. (in which he has invested a substantial amount)

Also, you'll notice that the BAC deal is for preferred stock, not the potentially more rewarding common stock. In the event of liquidation, preferred stock holders are in line for a payout before those who hold common stock.

But, at its core, this move is based on Buffet's belief that the American taxpayer will come through and safeguard his investment should the bank falter.

http://www.bloomberg.com/news/2011-02-11/buffett-tells-fcic-it-s-powerless-to-stop-too-big-to-fail-.html

Warren Buffett, the billionaire chairman of Berkshire Hathaway Inc., told the Financial Crisis Inquiry Commission that taxpayers will always be on the hook for collapses at the biggest U.S. companies.

“You will always have institutions that are too big to fail, and sometimes they will fail,” Buffett, 80, told the FCIC in a May 26 interview, according to a recording released by the panel yesterday. “We still have them now. We’ll have them after your commission report.”

The Dodd-Frank financial reform act, enacted in July, was touted by President Barack Obama as a means to ending bailouts and protecting taxpayers from firms that are “too big to fail.” Federal Reserve Chairman Ben S. Bernanke, who made more than $3 trillion of assistance available during the crisis, has said the “too-big-to-fail” issue can be eliminated only when investors believe the U.S. won’t rescue firms.

Investors were rescued in 2008 by Bernanke and then- Treasury Secretary Henry Paulson, whose relief programs cushioned declines for stockholders and bailed out bondholders at firms including American International Group Inc. Buffett, who injected $5 billion in Goldman Sachs Group Inc. at the depths of the crisis, said he was betting on the success of government intervention.

Buffett told the FCIC that he believed the U.S. would step in to provide liquidity to the market again if needed. The government would restart programs like the Commercial Paper Funding Facility, in which the U.S. backed short-term corporate debts, if crisis conditions return, Buffett said.

“I do think that if you ran into a similar situation today the government would guarantee commercial paper again. They’d have to,” Buffett said. “You have to believe the government, the federal government, will act and they will act promptly and decisively.”

Berkshire bought preferred stock in New York-based Goldman Sachs in 2008 after the collapse of rival securities firm Lehman Brothers Holdings Inc. Omaha, Nebraska-based Berkshire gets a 10 percent annual dividend on the investment and received warrants to buy $5 billion in common stock. with a strike price of $115 a share. Goldman Sachs traded for more than $165 on the New York Stock Exchange yesterday

“It was a bet essentially on the fact that the government would not really shirk its responsibility at a time like that,”

[banned from Kos]

16. You are confusing Commercial Paper with another TARP

There won't be another TARP. Congress has no stomach for it and Dodd-Frank has Liquidation Authority thus making it a moot issue.

In either case, Buffett would lose all $5 billion.

Buffett knows more about solvency than any person alive.

[MilesColtrane]

17. "Buffett would lose all $5 billion."

OK, I was talking out of my ass, not knowing the details of Dodd-Frank.

But, as much as the Wizard knows, even he has been wrong when it comes to the riskiness of investing in financial institutions the past few years. (Irish eyes ain't smiling)

[dickthegrouch]

9. Fret not -

It's just the robot mortgage foreclosure robots they're firing :sarcasm:

[Supersedeas]

12. What is their excuse--the government has cut interest rates and they are cutting folks who do the

lending

[Shagbark Hickory]

11. This is probably the first time I've ever been happy about an article warning of job cuts.

[BOG PERSON]

14. *plays the world's smallest violin for bank employees*

[HappyMe]

15. They are hiring here!

There's a 'we're hiring!' sign on the lawn of the local BoA here.