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Redundancies coming soon at BofA. And revisiting the notion that risk professionals are either hot or well paid


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.

Risk professionals – not as hot as they seem

Separately, much is being made of the Mercer survey we spoke of yesterday, and the fact that it suggests rising pay for risk professionals. 

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.

Comments (2)

  1. A general theory on redundancy: The so-called Truth is… You disappear, and so do your costs. The Real Truth is…Your job doesn’t necessarily. It is a) given to a back-stabbing rival; b) outsourced to a cheaper location or c) really does vanish, until they’ve weathered the storm and can up numbers again. (IN the real world, c) doesn’t happen: your boss doesn’t want to lose his status as a man in charge of many minions). In banks, they do a general headcount when they claim to be reducing numbers, but when it comes to specific redundancy areas they’re horribly vague. I would like to see redundancy as a proven loss of a previously necessary position, rather than a money-grabbing reshuffle of junior staff into more senior positions on lower pay, with banks axing agency staff and short term contracts and pretending to hold clean hands up when it comes to axing people while paying them a pitiful douceur for the loss of so much. La La Land? I can dream, can’t I?

  2. Got your breath yet?! Didn’t realise how long that last sentence was! Sorry, grammatophiles.

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