Bank of America Corp. is accelerating a broad cost-cutting plan and has set a target of shedding 16,000 jobs by year’s end-cuts that would see the company relinquish its title as U.S. banking’s largest employer.
Bank of America is the second-biggest bank by assets after being surpassed by J.P. Morgan last year.
Under Project New BAC, Bank of America has said it planned to eliminate $5 billion in annual expenses and 30,000 jobs by the end of 2013, largely through cuts in consumer and technology area.
On Main Street, the refocused company will have fewer branches and a smaller mortgage operation. Bank of America is planning to close 200 branches this year on top of 178 it closed in 2011.
The 2008 acquisition of Countrywide Financial Corp. turned Bank of America into a huge mortgage lender just as the U.S. housing market collapsed, and left the company more exposed to any other major bank to the severe economic downturn that followed.
Bank of America is one of many U.S. financial companies slashing thousands of jobs amid new regulations and a tepid economy that are crimping revenue. WSJ
Bank of America’s assets have increased to $2.1 trillion from $1.8 trillion in 2008.
In January 2008, Bank of America began notifying some customers without payment problems that their interest rates were more than doubled, up to 28%. The bank was criticized for raising rates on customers in good standing, and for declining to explain why it had done so. Bloomberg
More recently, the bank has been criticized for allegedly seizing three properties that were not under their ownership, apparently due to incorrect addresses on their legal documents. ABC News
The state of Arizona has investigated Bank of America for misleading homeowners who sought to modify their mortgage loans. According to the attorney general of Arizona, the bank “repeatedly has deceived” such mortgagors. Think Progress.
On March 14, 2011, one or more members of the decentralized collective Anonymous began releasing emails it said were obtained from Bank of America. According to the group, the emails document “corruption and fraud”, and relate to the issue of improper foreclosures. (PressTV)