It was recently noted that Bank of America’s 30,000 redundancies have barely begun. By the end of 2011, the bank had eliminated only 6,000 people.
Things are about to change. Especially at Bank of America Merrill Lynch.
In yesterday’s presentation at the Citi Financial Services Conference, Brian Moynihan said BofA made another 1,000 people redundant in January and February and that further cuts are fast approaching.
As outlined in slide 24 below, Moynihan said the bank evaluated who it wants to get rid of in Phase 2 of its cost cutting at the end of 2011 and that it will be getting rid of them in, “spring 2012.” Technically, spring 2012 starts on March 20th. Moynihan intimated that the cuts are likely to be brutally swift and ‘faster’ than the protracted trimming of phase 1.
Who will be affected? As ever, IT and infrastructure staff appear most at risk. Last year, Bank of America announced plans to rationalize its trading systems. However, headhunters say fixed income traders are also fearful for their jobs. Bank of America’s trading businesses underperformed in almost every area in EMEA last year according to Tricumen. This does not augur well for job security.
This, however, seems a little strange in light of that recent Robert Walters salary survey suggesting basic pay for risk professionals fell anything from 10-17% last year.
The head of one risk recruitment firm tells us some risk people have been paid, some haven’t, and that it depends from bank to bank. The banks in which risk professionals are most peeved with their 2011 payments are apparently Barclays Capital, Barclays Wealth, RBS, and UBS.
Several banks are preparing to make risk redundancies, he adds. They include BofA, RBS and Standard Chartered. RBS’s risk redundancies are particularly poignant: the bank is understood to have spent in excess of £1m building up its risk function last year.