Britannia Radio

US bank giant plans 11% jobs cut

Bank of America says the cuts will be across both businesses Bank of America has said it plans to cut between 30,000 and 35,000 jobs over three years following the completion of its takeover of Merrill Lynch. The reduction could affect about 11% of the combined firms' 308,000 workforce. Bank of America said the move would reflect both post-merger efficiency savings, and "the weak economic environment" which had hit business. The $50bn (£33bn) takeover of Merrill was announced in September. It came after Merrill had seen $40bn losses. Bank of America said the job cuts would come across both businesses, although it said it could not give exact numbers until early 2009. Industry-wide cuts The takeover has already gained shareholder approval and is due to be completed in the New Year.  In this day and age, it doesn't look as draconian, especially compared with what Citigroup did  Analyst Howard Diamond The combined company will be America's largest bank by assets. Merrill's loses were caused by bad debt connected to the downturn in the US housing market. The September announcement of its takeover by Bank of America came on the same weekend that rival investment bank Lehman Brothers said it was going into bankruptcy protection. Thursday's job loss announcement comes three weeks after fellow American bank Citigroup said its job cuts would now total 75,000. "If you asked me six months ago I would be surprised, but in this day and age, it doesn't look as draconian, especially compared with what Citigroup did," said analyst Howard Diamond, chief executive of Diamond Consultants.