News Column

BofA Cut 5 Percent of Jobs in 2012

Feb 28, 2013

Andrew Dunn, The Charlotte Observer

bank jobs

Bank of America dropped 5 percent of its workforce over the last year, declining to 267,000 full-time employees, the bank said Thursday.

That marks about 22,000 jobs cut by the bank since fall 2011, when it announced its large-scale cost-cutting program known as Project New BAC, named after the bank's ticker symbol.

Bank of America's occupancy costs, which the bank has also been reviewing, fell 4 percent to about $4.6 billion, the bank disclosed in its 292-page annual report released Thursday.

Bank of America also said it is being investigated by regulators over its identity theft protection services.

The Charlotte bank said it has received inquiries from regulators about customers who potentially paid for identity theft protection but did not receive the services from the third-parties the bank uses to provide them. The regulators are looking into whether Bank of America had adequate oversight, the bank said.

Bank of America said it could not elaborate on the disclosure. The probe was first disclosed in an August securities filing.

In Thursday's disclosure, it is not clear which services the disclosure refers to. Bank of America markets a number of security and protection services, some of which are free and some which carry a fee.

Other notes from the annual report:

Lawsuit reserves down. Bank of America trimmed its estimate for possible legal losses it could still incur on pending lawsuits to $3.1 billion, down from $3.6 billion it estimated last year. Since then, the bank has had several large-scale settlements, including a $10 billion accord with Fannie Mae over mortgages, and a $2.4 billion settlement ending a shareholder suit over the acquisition of Merrill Lynch.

Bank of America's litigation expenses fell to $4.2 billion in 2012, down from $5.6 billion the year before.

The bank also said Thursday that it could lose another $4 billion from mortgage securitizers seeking to force Bank of America to buy back bad loans.

Another tax benefit. Bank of America recorded a $1.1 billion income tax benefit for the year, the second year in a row in which it did so. In 2011, the bank recorded a $1.7 billion benefit.

The 2012 benefit stems primarily from foreign tax credits brought over when earnings from non-U.S. subsidiaries are brought back to the U.S., the bank said. Another $783 million in tax benefit came from low-income housing and other tax credits.

Source: (c)2013 The Charlotte Observer (Charlotte, N.C.). Distributed by MCT Information Services.

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