Rus News Journal

Bank of America has bothered to be big

As a result of reorganisation bank will dismiss ten thousand employees

the Largest bank of the USA, Bank of America (BofA), changes own image and business - model: the company reduces more than 20 % of the personnel and closes about 10 % of own branches. Meanwhile dismissals will concern mainly the employees occupied in a retail - bank operations, however next year works can lose representatives of investment division and the personnel serving corporate clients.

Has come to simplify and modernise time our bank and to be convinced that flowing business - processes keep the force even at less large size of the company. We do not need to be the largest bank - head BofA Bryan Mojnihan has declared. Together with a command of others a top - managers the present head of bank tries to realise the so-called plan the Project new BAC (BAC - share tikker BofA).

According to the first stage of reorganisation BofA in frameworks the Project new BAC the company will soon lose about 40 thousand employees, confirms The Wall Street Journal. Speech in this case goes mainly about the personnel occupied with service of physical persons. As of July, 30th, 2011 in BofA worked about 280 thousand persons. From the beginning of this year the bank already has had time to dismiss 6 thousand employees. Similar measures, are assured of management BofA, will help the company to save quarterly nearby 1,5 mlrd dollars

In parallel with mass lay-offs in bank prepare for closing of own branches. The next years the existence will stop about 10 % from 5700 branches BofA. Thus process of closing of offices already goes: for one only the second quarter their quantity was reduced to 63 branches.

It is remarkable that changes pass in bank in all directions: In August g - n Mojnihan announced considerable changes in company management, having dismissed two top - managers and having appointed two new operational directors. The bank also has managed to involve financing, having sold the preference shares for the sum 5 mlrd dollars of company Berkshire Hathaway of Warren Baffeta. Additional means have been obtained at the expense of partial sale of share BofA in China Construction Bank. The bank also tries to get rid of a considerable part of the mortgage business.

It is supposed that the second part the Project new BAC will begin in October and it will be devoted basically to the commercial divisions of bank occupied with investment operations and trading, and also management of actives and service of corporate clients. The second wave also means additional reduction of the personnel. BofA now is in very bad condition - the bank needs to reduce urgently own costs and to be focused on those divisions which make good profit. It seems to me that g - well Mojnihanu nevertheless will be possible to achieve the and to result BofA in excellent financial indicators. By the way, purchase of actions of bank now can become the good investment: papers are meanwhile underestimated, even in spite of the fact that the investment guru Warren Baffet has bought recently the big share holding - analyst EIU Stephen Lesli has told daily.