Magazine article American Banker

BankAmerica Plans to Cut 10,000 Jobs after Merger

Magazine article American Banker

BankAmerica Plans to Cut 10,000 Jobs after Merger

Article excerpt

SAN FRANCISCO -- In its first estimate of merger-related job cuts, BankAmerica Corp. said Thursday that it would trim 10,000 to 12,000 positions within three years of its acquisition of Security Pacific Corp.

The estimate, representing about one of nine jobs in the combined organization, is at the low end of anlaysts' forecasts.

The projection does not include positions in some 220 braches that will be divested to satisfy regulators' antitrust concerns. That could eliminate another 2,000 to 4,000 employees from the two companies' payrolls, which totaled 91,000 at yearend. Most of the branch employees are expected to keep their jobs after the sales, BankAmerica said.

Attrition Is Big Factor

The company stressed in a statement that many of the projected job cuts would result from attrition, though it did not specify how many. More than 20,000 jobs in total turn over at BankAmerica and Security Pacific in a typical year, the company noted.

BankAmerica's announcement came in response to a report in the San Francisco Examiner Thursday saying that 18,465 jobs would be eliminated in the merger. The report, citing an internal company document prepared in November, said that more than 9,000 of the lost jobs would come from retail banking operations in California.

BankAmerica's statement, which did not refer to the report, implicitly denied the 18,465 figure. But the San Francisco-based company declined to comment on the existence of the memo.

Since the announcement of the biggest-ever U.S. banking merger last August, the question of how many jobs would be lost has been extraordinarily sensitive.

BankAmerica has been under pressure from Wall Street to produce high cost-saving estimates, meaning big job cutbacks. At the same time, the company has needed to reassure jittery employees, while motivating them to be productive while the merger is pending. …

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