BofA CEO Moynihan Sees More Job Cuts as Bank Reduces Costsby
Lender cut more than 10,000 jobs last year as revenue fell
Moynihan says 2016 headcount `will be lower than it is now'
Bank of America Corp., the lender that cut more than 10,000 jobs last year, will reduce the number of employees in 2016 as it seeks to lower costs amid declining revenue, Chief Executive Officer Brian Moynihan said.
“We took down the headcount by 2,000 in the fourth quarter,” Moynihan said Thursday in a Bloomberg TV interview from the World Economic Forum in Davos. He declined to say how many jobs would be cut this year, “but it will be lower than it is now.”
Bank of America, the second-largest U.S. lender, had 213,280 employees as of Dec. 31, down 4.7 percent from a year earlier, according to a financial statement from the Charlotte, North Carolina-based bank.
Revenue growth will be “challenging,” even as the U.S. economy improves, Chief Financial Officer Paul Donofrio said Tuesday on a call with analysts after the firm reported fourth-quarter results. Net income for the three months that ended Dec. 31 increased 9.4 percent to $3.34 billion, or 28 cents a share, from a year earlier, the bank said in a statement. Revenue for the year fell 2.1 percent to $82.5 billion and expenses declined 24 percent to $57.2 billion.
Since 2010, Bank of America has cut costs the most among its competitors as low interest rates and volatile markets stymie revenue growth. Still, the bank’s efficiency ratio, a measure of how much it costs to produce $1 of revenue, came in at 68.6 percent for 2015, compared with 57 percent for Citigroup Inc. and 57.8 percent for Wells Fargo & Co.
Bank of America shares slid 0.8 percent to $13.58 at 12:52 p.m. in New York. The stock has declined 19 percent this year, the third-worst performance in the KBW Banks Index, which has dropped 15 percent.