Bank of America to Cut 7,500 Jobs on Countrywide Deal

[marmar]

from Bloomberg:



Bank of America to Cut 7,500 Jobs on Countrywide Deal (Update2)

By Erik Holm

June 26 (Bloomberg) -- Bank of America Corp., the second- largest U.S. bank, will cut about 7,500 jobs after buying Countrywide Financial Corp.

The purchase is expected to be completed July 1, Charlotte, North Carolina-based Bank of America said today in a statement. The reduction over the next two years -- equal to about 2.9 percent of the combined staff -- will occur where jobs overlap ``throughout the country,'' the bank said. Notices will be sent during the third quarter.

Countrywide's shareholders yesterday approved Bank of America's takeover, originally valued at about $4 billion, clearing the way for a bailout of the mortgage lender that became a symbol of the subprime boom and bust. Countrywide, the biggest U.S. mortgage company, employed about 50,000 people at the end of the first quarter, according to Bloomberg data, while Bank of America's staff was 209,000.

Bank of America fell 6.7 percent to $24.84 in 3:45 p.m. New York Stock Exchange composite trading. Countrywide slipped 3.7 percent to $4.41.

Today's announcement may finally quell speculation that Bank of America plans to back out the deal because Countrywide has lost money since the accord was announced in January. The value of the bank's all-stock bid for Countrywide has fallen to $2.67 billion as investors became more concerned about the weak U.S. economy and whether the mortgage company's losses would cripple Bank of America's earnings.

Countrywide is based in Calabasas, California. The world's biggest financial firms have already announced more than 82,000 job cuts after posting $400 billion in writedowns and credit losses tied to the U.S. housing slump.

http://www.bloomberg.com/apps/news?pid=20601087&sid=a5A2wKEQ2sOA&refer=home

[jazzjunkysue]

1. Couldn't happen to a nastier company. They dug their own grave

every time they didn't verify a borrower's status, and every time they pushed more loans at poor people.

The really sick thing is, because of the point system, the countrywide salespeople got their cut up front and they pushed for higher loans so they'd make $50 more on a commission. It made them $50 more but it put the family in over their heads.

I wish they'd all be fired. I payed off my countrywide mortgage after 6 months and bought a wachovia when the rates dropped. In a few months I'll already be caught up after closing costs and then it's all gravy.