Money Matters, Simplified.
Bank of America to axe 3,500 Jobs
by Rahul K. Chaudhary - August 21, 2011 - comments
Bank of America, the second largest non-oil company in the United States (after Walmart), has long been struggling against economic gridlock and various litigations. With intent to regain its dominance in U.S. market, it has decided to slash as many as 10,000 jobs.
Bank of America Corporation, which has long been waning at the stock market and is plagued by various sensitive issues like bad mortgages, is set to lay off 3,500 workers by the end of this quarter in September.
That’s over 1 percent of its battalion of 288,000. In addition, it is mulling a restructuring project that will further throw thousands of its employees out of work.
Layoffs looming over leading banks
The economic instability is apparently forcing leading banks to safeguard investors’ benefits. Hence, various leading banks, including Hub money manager State Street Corp., Bank of New York Mellon, and Goldman Sachs have declared layoffs recently.
Earlier this year, the banking giant terminated 2,500 jobs following a downtime at stock market; the bank has witnessed a slump of 50 percent stock value since January.
It is quite evident that the political and mortgage gridlock, coupled with the European debt crisis, is inducing an insecurity for the Bank of America, forcing it to focus on shareholders’ safety and interest.
So far, so bad for Bank of America
Since January, it seems like the bank is out on a wrong foot. A bad run at the stock market inspired thousands of pinks slips, and experts claim the bank could eradicate up to 10,000 jobs.
The bank could cut more jobs as an initiative declared earlier this year, termed “Project New BAC,” lays emphasis on reducing expenditures and increasing revenues, revealed bank’s spokesperson Scott Silvestri.
Though Bank of America holds enough capital to combat the peril, it is struggling against lawsuits and various issues regarding its gigantic portfolio of anxious loans, many bagged when it acquired Countrywide in 2008.
The bank was heavily injured when housing market tanked and is still grappling with litigations and lawsuits.
With intent of safeguarding its investors from the influence of these financial issues, the company is all ready to axe low level, already underpaid workers.
The bank will, reportedly, lay off its employees, in part, by relocating its offshore businesses to Costa Rica and away.
About Bank of America
Charlotte, N.C.-based Bank of America is the largest bank-holding firm in the United States, in terms of assets. It provides financial and banking services in over 150 countries and is connected to almost 99 percent of America’s fortune 500 companies.
The company is among the four leading banks in the nation, along with JPMorgan Chase, Citigroup, and Wells Fargo, its core competitors.