BofA Earnings Flag, Layoffs Announced
Bank of America said today it will lay off 1,500 employees and 2,000 contract position in its mortgage business as it continues to deal with loan losses. The company's first quarter profit was down 36-percent over last year. Only a handful of the job cuts - about 15 - will come from the Carolinas, as Bank of America shrinks offices that handle new mortgages nationwide. The bank's home loan business continues to drag the rest of the company. In recent months, CEO Brian Moynihan has sounded optimistic that Bank of America would be able to start paying a dividend to shareholders by the end of the year. Not today. "Whether we get the dividend in second quarter, third quarter, fourth quarter, first quarter whatever - next year, this year, what we're trying to be clear to you is we're doing the work we need to do," said Moynihan on a conference call with investors. "We've been repositioning this company and improving it and as soon as we and the regulators and the process is set, we'll let you know where we stand." Moynihan spoke with investors on a conference call this morning. Bank of America was the only one of the nation's four largest banks to have its plans for restoring a stock dividend rejected by federal regulators in a recent review of bank strength. Bank of America said today its home loan business lost $2.4 billion in the last three months. Those losses were offset by strong performance in the bank's credit card division, so overall Bank of America made $2 billion for the first quarter. That was less than analysts had hoped. Bank of America also announced a shakeup in management - CFO Chuck Noski is leaving that position for family reasons, but will continue to advise Moynihan. The bank is also creating a new position focused on dealing with its legal and regulatory problems.