Bank of America to Cut 35,000 Jobs

Bank of America has announced that it is cutting up to 35,000 jobs as it becomes the latest financial institution to implement sweeping cost savings.

The Charlotte-based bank joined Citigroup, Credit Suisse and UBS in preparing to ax thousands of people from its payroll today as it cited the economic downturn and a $50bn merger with Merrill Lynch as the reasons for the move. BoA declined to comment on how many UK jobs will go but Merrill has a significant presence in the City including a plush headquarters opposite the London Stock Exchange.

"The reductions are designed to eliminate redundancies created as a result of the merger with Merrill Lynch and to reflect the current recessionary environment.," BoA said in a statement. The banks have a combined workforce of around 312,000 people with BoA, which has a significant retail operation with more than 6,000 branches, contributing the majority of that total with 247,000 employees. Today's announcement represents a workforce reduction of around 11%.

The bank said between 30,000 and 35,000 jobs will go from the joint BoA and Merrill workforces over the next three years and it expects to announce a final number early next year. Cuts will be made in all parts of the business and as many as possible will be generated by attrition, BoA said. It added that the business was doing well from a "flight to safety" by depositors and investors as the credit crunch continues to buffet banks.

Despite its avowal that it is a healthier state than many of its rivals, BoA has had to tap the $700bn Troubled Asset Relief Program set up the US Treasury to recapitalizes banks' stricken balance sheets. So far it has received $15bn from the TARP and a further $10bn from investors. Merrill was forced to agree to a takeover by BoA in September as, weighed down by subprime mortgage securities and risks debts, its scrambled to avoid the same fate as Lehman Brothers – which went bankrupt over the same weekend.