Bank of America Layoffs Begin

Posted by you guys are behind the curve on layoffs, Jan 23, 2008 12:23PM

Thank you, Dealbreaker, but you are kind of behind the curve on layoffs across the board. C fired scores of people last week and the week before from all groups and no mention of that.

Posted by Dealbreaker is behind the curve, Jan 23, 2008 12:25PM

Thanks, Dealbreaker, but no mention of the thousands (including bankers) who got laid off at C last week. A lot of directors, analysts and associates.

Posted by , Jan 23, 2008 12:27PM

hey DB is only as good as the info you give them, so you know, if you have so much great inside info about who is getting fired or how much they are getting paid out, maybe you could help out and send a message to tips at deal broker dot com or just post a comment instead of bitching about it

Posted by Not Kandi!, Jan 23, 2008 12:27PM

Wait, did you say Scores fired people? It must be worse than I thought out there.

Posted by Anon, Jan 23, 2008 12:42PM

Does BOA even qualify for this site anymore? what are they going to do, cut back on tellers?

Posted by , Jan 23, 2008 12:43PM

Any layoffs in the middle market space yet?

Posted by Just sayin..., Jan 23, 2008 12:51PM

Funny how all of the bigshots on this site from the"Big 5" IB's take shots at BOFA. Last I checked, you all lost waaaayyyy more money on subprime. At least BOFA doesnt have to beg terrorist countries to pump cash into them to remain solvent, they have actual revenue streams that can help them whether the storm. Just food for thought

Posted by , Jan 23, 2008 12:52PM

Any layoffs in the middle market space yet?

Posted by YeahISaidIt, Jan 23, 2008 12:55PM

to Anon@12:42. you are a supreme d-bag. work on your insecurities instead of your ignorance.

Posted by , Jan 23, 2008 1:02PM

@12:51 i agree 12:42 is a dbag but to your point, among the US ib's no only merrill and morgan stanley lost more money than BAC on subprime check your facts

Posted by AJ, Jan 23, 2008 1:06PM

@12:51, but isn't the point that the Big 5 are taking the terrorists' money so that they can stay in banking despite the losses... BofA seems to have decided to just run away and admit they weren't cut out for it...

Posted by Anal_yst, Jan 23, 2008 1:11PM

Uh, what about that shiney new building BofA is finishing up on Bryant Park here in NYC?

Last I remember part of their subsidy package mandates they have something like 5k (or whatever k) employees in there by 2009/2010. Not to be a dick (or to be a dick?) but if they get rid of their Investment Banking and Capital Markets groups, who the f%ck are they gonna put in there?

Posted by , Jan 23, 2008 1:13PM

Depends AJ, are you including UBS and Citigroup, major universal BANKS in your list of offenders? because they have taken more terrorist loot than anyone else to stay in banking

oh, maybe Merrill and UBS took about the same but still

Posted by yo, Jan 23, 2008 1:19PM

@AJ, actually BofA is staying in IB, they are just cutting off the fat, something ALL the banks are doing. Lewis's "fun" comment was over-analyzed. BofA will continue to be a factor in the banking and corpfin space.

Posted by Master of None, Jan 23, 2008 1:22PM

@12:51

Last time I checked, China is not a terrorist nation (It doesn't count if it's your own people).

Posted by , Jan 23, 2008 1:22PM

Agreed, particularly in any capacity that serves the corporate clients

Posted by Master of None, Jan 23, 2008 1:25PM

@Anal_yst

Walmart will buy BofA to expand it's personal finance footprint, and will then make the new Bryant Park building it's first store in Manhattan.

Posted by AJ, Jan 23, 2008 1:27PM

@1:13 well, while I'm busy slandering people, I might as well throw out that UBS is just a bunch of Nazi enablers

Posted by , Jan 23, 2008 1:29PM

lol

Posted by , Jan 23, 2008 1:33PM

Nazi principals actually

Posted by theTRUF, Jan 23, 2008 1:35PM

who cares if you work at a "Big5"? MONEY TALKS. Keep telling yourself you're hanging around for the prestige. LOL.

Posted by Director, Jan 23, 2008 1:55PM

BofA laid off some of their best people today...top Analysts (II ranked 1-3) and top Salespeople and Sales Traders. Their CEO said earlier this week that he is "committed to inv. banking" but the reality is, he's not committed enough to pay his top people. As such, anyone left will likely be leaving as soon as their annual bonus check clears (if they are getting one.) Ken Lewis doesn't get it - BofA was on its way up with a lean and solid team.

Posted by Smartie, Jan 23, 2008 2:03PM

And those laid off got nothing...no bonus, no severance, nada. they just got screwed.

Posted by , Jan 23, 2008 2:11PM

@thetruf did you even read the comments or are you just a moron?

Posted by , Jan 23, 2008 2:23PM

Director, not sure maintaining a stable of II ranked equity analysts would have been in BofA's best interests in terms of not wasting money on non-core businesses when you can get a hungry jr analyst to cover the same stocks for $500k that you are paying a guy $3 million to cover

Posted by theTRUF, Jan 23, 2008 2:23PM

@AnonymousLOSER 2:11pm

its theTRUF. get it right, son. i speak it and it hurts, doesn't it? just search "top 5", its clearly obvious you cant process the multiple story lines on this page. DOH!

Posted by Director, Jan 23, 2008 2:27PM

Anonymous-

Not sure what year you're living in, but most of those top-ranked Analysts were actually getting paid under $1mm (some around $500k.) We're not in the year 2000 anymore. And, like it or not...those seasoned Analysts are what clients want/need...they don't need to speak to some Jr. person who hasn't seen a cycle or understand how to read through mgmt. comments, etc.

It's a sad day for BofA - to bleed the business of its best resources and talent. And not only those who may have happened to be making top money, but those who also were driving a lot of business for the firm.

The Jr.'s? Why would anyone care what they have to say....buys-side shops can do their own research....actually better.

Posted by Yo!, Jan 23, 2008 2:36PM

No bonuses or severance? That's just wrong. Looks like Ken Lewis made $8m in cash comp last year and a grand total comp number of $27m. The Man's got your bonuses and severances packages himself! And He's the jackhole foolishly buying Countrywide! It's a shame that we live in such a civil time and work in such a civil industry, b/c this is what angry mobs and lynching parties were created for!

Posted by oops they did it again, Jan 23, 2008 2:37PM

just heard from a reliable source: guy just got promoted earlier this month only to get a pink slip today a bofa...wtf? does that make any sense?

Posted by , Jan 23, 2008 2:54PM

@ Director You think Kevin McCarthy and John Macdonald are making under a million? I doubt it. So far I am hearing just about guys on the research side I know get paid in the millions cut loose. And yes I worked in the industry in 2000 and I know that salaries took a hit but buddy that was 8 years ago and a lot of people have moved around and a lot of guarantees made as banks staffed up during the boom the last half decade.

Reg FD has all but destroyed the value of most of the analysts who have been around a long time anyway. Now most of the value in these guys is the marquis on his business card that gets him meetings with management to take me to. That's what my firm pays for. And we will pay the junior as much as the senior as long as we get our meetings.

Posted by , Jan 23, 2008 2:57PM

"seasoned Analysts are what clients want/need..."

HAHAHAhaha that is the funniest thing I ever heard

yeah there are a few good analysts out there but come on

Posted by Ken Lewis, Jan 23, 2008 2:58PM

Feeling Tier 2 today.

Posted by anotherguy, Jan 23, 2008 3:08PM

The days of $1 million for research analysts are over, over, over. Pay absolutely tops out at around $500K now, and even that is rare. Now, never forget that analysts may get some limited opportunities to put their own money in private deals, and to invest for their own account, and they can improve their income that way. But as far as base salary + bonus, it's very difficult to for a firm to pay over $500K without creating the appearance of analysts being compensated by I-Bkg revenue.

That said, I still am astonished about how cavalier firms can be about cutting loose good research analysts. Equity research has a --> r-e-a-l-l-y The days of $1 million for research analysts are over, over, over. Pay absolutely tops out at around $500K now, and even that is rare. Now, never forget that analysts may get some limited opportunities to put their own money in private deals, and to invest for their own account, and they can improve their income that way. But as far as base salary + bonus, it's very difficult to for a firm to pay over $500K without creating the appearance of analysts being compensated by I-Bkg revenue.

That said, I still am astonished about how cavalier firms can be about cutting loose good research analysts. Equity research has a --> r-e-a-l-l-y <-- long apprenticeship compared to many other areas, and it's extremely rare for junior analysts to be effective in the first few years after they get promoted.

Posted by , Jan 23, 2008 3:14PM

Anotherguy, you are 100% wrong about comp.

This year $500k may be tops b/c of a poor year, but $500k is certainly not the ceiling in a "normal" year.

And investing for their own account? Firms don't let you invest in anything that even smells like a company in your coverage sector. Cover pharma companies? Don't plan on being able to invest in ANY health care companies.

Posted by just me, Jan 23, 2008 3:16PM

Nobody cares about second rate banks exiting trading/sales. All second and third tier banks think they are the balls of the investment universe, but really, truly they suck at trading.

But...if any hot chicks got laid off and need a place to stay, let me know. I'm very understanding.

Posted by , Jan 23, 2008 3:20PM

most of the sell-side analysts I know who have 3+ years experience (senior) make in the $500k ballpark .... and some of the ones who have a decade+ in a bulge make $1MM+

replacing them with junior talent making ~$300k makes sense

Posted by anotherguy, Jan 23, 2008 3:24PM

Maybe I was too unilateral. Let me put it this way. I would argue that AVERAGE comp, from year to year, in excess of $500k is rare among the senior analysts I know in research. If someone's sector has a stellar year, I suppose they could edge above that. But I think the days of a great analyst getting over $500K, let alone over $1 million, in most years, year-in year-out, are over. If people think that's definitely not the case, I'll have to circle back with some of my friends and get a reality check.

Remember, many of the best analysts have left research (and gone to I-Bkg, or hedge funds) for just that reason. Compensation just isn't like it was in the old days. An awful lot of sectors are covered these days on the sell-side by analysts with 5-10 years experience who do not command huge pay packages, and a lot of the highly paid, high-reputation "lions" of the field are long gone.

That said, as I started to say before [text got cut off] I still am astonished about how cavalier firms can be about cutting loose good research analysts. Equity research has a really long apprenticeship compared to many other areas, and it's extremely rare for junior analysts to be effective in the first few years after they get promoted.

Posted by anotherguy, Jan 23, 2008 3:29PM

Anonymous @ 03:20 posted while I was writing. What he/she said is right in line with my thinking, compensation-wise.

Posted by , Jan 23, 2008 3:29PM

anotherguy: very thoughtful and useful comments. Thanks for taking the time.

Posted by hrdnitlr, Jan 23, 2008 3:33PM

People at BofA are getting zero severance ??!!?? That's f*@$ed up.

Posted by , Jan 23, 2008 3:56PM

From reliable source: bad stuff at bofa...wiped out currency options desk and most of
london--fired their entire london energy desk and most of ny.
more layoffs tomorrow

Posted by , Jan 23, 2008 4:20PM

I happen to know several people who were made senior analysts in the past few years who are already making a decent amount over $500k but not 1 million covering a range of sectors from substantial to niche. Most of them do not feel that the $1 million mark is too far out of reach, probably just a matter of jumping to another firm during the next up-leg of the cycle.

I do agree with anotherguy's comments about the long apprenticeship, but there is definitely still fat in the system. And many good young analysts have emerged who will still have jobs (even at BofA)

and @3:16 no hot chicks dont get laid off are you joking? dudes and busted chicks get laid off.

Posted by , Jan 23, 2008 4:23PM

fired w/ no severance days before bonuses. classy move by bofa. i agree, as soon as those paid (if they are paid) get their checks they will be gone.

Posted by , Jan 23, 2008 4:25PM

I heard the same thing with regard to the London office. Wiped out.

Posted by , Jan 23, 2008 5:08PM

Who on this thread can confirm that BofA has given zero severance? Are these posts specualtion or fact? In the previous round of layoffs a few months ago, there was a small amount of severance. To give zero is shocking and does not bode well for the people awaiting bonuses later in the week.

Posted by , Jan 23, 2008 5:09PM

Who on this thread can confirm that BofA has given zero severance? Are these posts specualtion or fact? In the previous round of layoffs a few months ago, there was a small amount of severance. To give zero is shocking and does not bode well for the people awaiting bonuses later in the week.

Posted by anon, Jan 23, 2008 5:31PM

I heard last week bonuses wiped for existing MBS guys (from friend at BofA) but not zero severance??

Posted by anonymous, Jan 23, 2008 5:32PM

I know for certain of one analyst that got zero severance other than options being vested. Bonuses would have been paid mid-February, and I would think they will be very light for those remaining.

Posted by anonymous, Jan 23, 2008 5:33PM

I know for certain of one analyst that got zero severance other than options being vested. Bonuses would have been paid mid-February, and I think they will be very light for those remaining.

Posted by Director, Jan 23, 2008 5:42PM

I can confirm for most equity people that they got very little. Generally, 2 wks. base for every year of service (as you know, this is nothing given most of salary is on bonus, not base.) Plus, most of the people there were hired guns from other shops to help build market share (very few had been there over 3 yrs.) In addition, VP's to MD's got a "severance" payment anywhere from $5k - 50k but that was about it. And yes....that's it....no 2007 bonus. As you know, $50k is ridiculous compared to the hundreds of thousands they were essentially due from 2007. And, the severance starts on Feb. 15th (perfect for BofA, since technically they can say you were employed through the 14th, the legal date to which they can deny '07 bonus.) Suffice it to say, BofA bought billions of losses through CFC, they laid off people who have proven to make the firm millions, and now they're going to endure millions in legal fees because every single person who I know who got laid off today...will be suing the firm. Every....single....one.

Posted by , Jan 23, 2008 5:52PM

Yep, bring the lawsuits on. That's disgraceful. You can't fire day before bonus.

Posted by , Jan 23, 2008 5:52PM

Director: That sucks. I'd be interested however in knowing on what grounds people are going to sue. I know from experience that large firms orchestrate these things very carefully, largely to protect themselves against such outcomes. I think in a few days cooler heads will prevail and there will be a lot less suing going on. All the best - I feel for you.

Posted by , Jan 23, 2008 5:55PM

options being vested.... Isn't the stock off like 30% this year? Gonna be a long time till those options are worth something.

Posted by , Jan 23, 2008 5:55PM

i think it's a pretty well established law in NY that you can't fire specifically to avoid paying a bonus which is otherwise due. that's why most firms do the firing in the fall (further away from paying discretionary comp, the better the case for the employer). anyway, best of luck to all who pursue that route.

Posted by , Jan 23, 2008 5:57PM

i think it's a pretty well established law in NY that you can't fire specifically to avoid paying a bonus which is otherwise due. that's why most firms do the firing in the fall (further away from paying discretionary comp, the better the case for the employer). anyway, best of luck to all who pursue that route.

Posted by Grizzled Geezer, Jan 23, 2008 6:20PM

legal cases have Zero merit unless you have a tan or wear a skirt......

Its Wall St. not the Company Man of the 1950s

They will roll out tapes of your personal calls, web-usage, car service/T&E abuse, etc.

And if you are in litigation w/IB bank good luck finding future employment at an IB.

Take your lumps and move on; the market will come back and you will make $$$$$$$ if you were any good.

3 Bulges under belt and survived worse than above and '95, 98, '01, '07w/$

Posted by skirt, Jan 23, 2008 7:01PM

@6:20 -- thanks for keeping it real and schoolin' 5:57!

i wore a skirt but didn't sue...

Posted by , Jan 23, 2008 7:53PM

not sure if suing BofA counts as litigation with a Wall Street firm :)

Posted by oops they did it again, Jan 23, 2008 9:53PM

I can confirm that bofa didn't use vaseline. a buddy called looking for a lawyer. 1st year vp, go $50K inclusive of the standard 8 weeks of severance. the guys/girls in the first wave were treated better, but that's not saying much.

Posted by drumbane01, Jan 24, 2008 12:24AM

Thanks to all you guys in the IB and general bnkg biz, much insight gained into how the thought processes work in that field in time of crisis.....from an artistic type. You all get more as base salary for one year than a lot of "artistic" types get in three...but nonetheless we all feel for you especially as the trickle down will affect us all within two years.

Posted by hrdnitlr, Jan 24, 2008 12:40AM

I am still just dumbfounded by the lousy severance, on top of no bonus. That's pretty much unprecedented, isn't it? I recall during the dot-com bust and the couple of years after, nobody I knew got less than 3 months' salary as severance. (Though I guess the $50k mentioned above could be about 3 months' worth for a lot of people.)

You know, I'm guessing that it's a sign of how carefully they must be nursing their cash at BofA. But still, the reputational hit for them will be big down the road. I came close to taking a job with them about 4 years ago, because at the time I was just about convinced they were finally a real I-Bank, and weren't going to be pulling this mickey-mouse crap anymore. I will have to be awfully hungry in the future to ever consider going there now.

Posted by n_r, Jan 24, 2008 12:54AM

Bank of America Cuts 25% of Stock Analysts, Ex-Employees Say

http://www.bloomberg.com/apps/news?pid=conewsstory&refer=conews&tkr=BAC:US&sid=attOQILewT3A

Posted by Insider, Jan 24, 2008 6:11AM

Regarding "wearing a skirt" and regarding lawsuits, I think BofA is in trouble because people do have cases (and at the very least, BofA will have to pay big time to defend their position.) 100% of the Principals or above they fired in Equity Sales in NYC were women. Also note, of the 3 Directors of Research, they chose to fire the 1 woman. And the 2 senior women remaining at the firm are not viewed as a threat, shall we say, to management at BofA. In addition, most of the older talent was marched out the door (more expensive, yes, but also older/agism.)

Not only did people not get a severance, but many people (especially in Research) literally were told that "they will know next week" if they will get something more (heard this direct from a very senior Research Analyst.) According to my lawyer friends, they cannot fire you without telling you what your package is (and they did for many.)

The place is a joke, I've been in the business for 18 years and I've never seen such poor top management. I already know of 5-7 of their top remaining Analysts and 100% of them are leaving for a real opportunity once their bonus check clears.

Ken Lewis can say that he is still invested in this investment banking business all he wants. But, at the end of the day, he fired his most expensive (and best) people, and anyone left who is good is on their way out as soon as their checks clear. He clearly doesn't get it.

Posted by just me, Jan 24, 2008 9:21AM

hahaha...what a bunch of little beeyatches the BofA crowd is. You endlessly lambaste real companies with your "analysis" and when the axe falls on you, you go running for lawyers, and cry to your Momma's about how unfair life is.

Grow a spine and maybe some balls. They can fire you at a moment's notice as you 'serve' at their goodwill.

But, again, if any hot looking chicks got laid off, I can be very reassuring and a good listener.

Posted by , Jan 24, 2008 9:31AM

I feel for you guys, because I've been there. But we're the people that preach rugged individualism, survival of the fittest, winner take all, anything goes. Isn't a bit immature to start crying "unfair" now that that system has made you a victim? You can't have it both ways. You want fair, work for the post office.

Posted by , Jan 24, 2008 9:42AM

i disagree. thankfully don't work at BAC, but it is understood that you either pay or fire earlier. think about it, the whole system falls apart if you don't honor that. word is bond.

Posted by , Jan 24, 2008 10:09AM

pay or fire earlier? what does that mean? clear as mud. you deserve to be next, with that level of clarity.

Posted by , Jan 24, 2008 10:39AM

why thank you 10:09. nice of you to say. the point was that you cannot fire the day before the bonus is due to avoid paying it. if they wanted to clean house, shut down research or whatever, and not pay bonuses, they needed to do it in the fall at the latest. even then most firms give some severance. all of us work with the understanding that if we complete the year and do our jobs we will receive compensation. yes we understand there is discretion in that number but this is beyond what everyone here would agree is within discretion (except you maybe).

Posted by WTF, Jan 24, 2008 10:49AM

@just me - seriously dude. take your sexually depraved @ss elsewhere. your desperation stench is unbearable...looking for "hot girls that got laid off"??? are you serious? dont you have somewhere else to be like on your knees begging a hooker on a street corner or something? fkg douche.

Posted by , Jan 24, 2008 11:13AM

10:39 Got it and apologize for being flip. I think bottom line here is that there is a wide interpretation of what's fair. That is, how much of the overall firm's losses should be taken from the hide of the departing employees, by denying them bonus comp. I don't know the answer. If I was a shareholder I would say 100%. A departing employee would say that they deserve none of the pain for others mistakes. The answer is clearly somewhere between and will impact how the firm is perceived in the future, when they add resources for the inevitible comeback. My guess though is that people have short memories and if BOA is hiring five years from now, potential hires will not be too concerned with this. Which is bad news for people being dinged today.

Posted by hrdnitlr, Jan 24, 2008 11:20AM

I definitely believe the "your word is your bond" thing matters. The whole system functions on trust (not interpersonal trust, I'm talking about rules-of-the-road trust), and you can't change the customs of how these things are done without it having a big negative impact on the firm's reputation. If you cut people, you've got to give them some serious cushion on the way out. That's what big, one-time severance charges are for.

Posted by just me, Jan 24, 2008 11:24AM

@wtf -- hopefully you're next in line for being fired. seriously, all these little girls and boys go crying to Mommy when some dopey bank isnt handing them 6 figure incomes. Maybe if they produced some income for their employer they wouldn't be fired. The algorithm is pretty simple really - make money or go work elsewhere.

And laid off chicks put out the most, especially when faced with the dual prospect of an unemployed pasty boyfriend like you and having to move back home.

Not everyone makes it in NY, thats why we have suburbs.

Posted by hrdnitlr, Jan 24, 2008 11:25AM

I definitely believe the "your word is your bond" thing matters. The whole system functions on trust (not interpersonal trust, I'm talking about rules-of-the-road trust), and you can't change the customs of how these things are done without it having a big negative impact on the firm's reputation. If you cut people, you've got to give them some serious cushion on the way out. That's what big, one-time severance charges are for.

Posted by anonymous, Jan 24, 2008 11:46AM

more analysts have been laid off this morning...

Posted by WTF, Jan 24, 2008 12:02PM

@just me. lol. its confirmed now. you are an absolute tool. my guess is youre prolly an overworked donkey with delusions of grandeur and a face like stank cheese. ha ha. i on the other hand am fortunate enough to have just been promoted again after being promoted just 2yrs ago. Im not going anywhere.

btw my apologies to the thread readers looking for serious posts - and to the people getting laid off, I empathize...I just felt obligated to hand some fire to this jagoff. im finished responding to him now tho. hes obviously a useless twat.

Posted by WTF, Jan 24, 2008 12:08PM

@just me. lol. its confirmed now. you are an absolute tool. my guess is youre prolly an overworked donkey with delusions of grandeur and a face like stank cheese. ha ha. i on the other hand am fortunate enough to have just been promoted again after being promoted just 2yrs ago. Im not going anywhere.

btw my apologies to the thread readers looking for serious posts - and to the people getting laid off, I empathize...I just felt obligated to hand some fire to this jagoff. im finished responding to him now tho. hes obviously a useless twit.

Posted by skirt, Jan 24, 2008 12:09PM

@6:11 -- didn't wear a skirt at B of A -- but I believe you a million times over. It's very sad to see the stuff that you speak of, and it's not confined to B of A for sure...

Posted by WTF, Jan 24, 2008 12:10PM

@just me. lol. its confirmed now. you are an absolute tool. my guess is youre prolly an overworked donkey with delusions of grandeur and a face like stank cheese. ha ha. i on the other hand am fortunate enough to have just been promoted again after being promoted just 2yrs ago. Im not going anywhere.

btw my apologies to the thread readers looking for serious posts - and to the people getting laid off, I empathize...I just felt obligated to hand some fire to this jagoff. im finished responding to him now tho. hes obviously a useless twit.

Posted by interested, Jan 24, 2008 2:12PM

I am sure this is a naive question (I am not in the busiess and just came across this discusion through surfing), but they just fire people without notice, without pay...and does it include people from the top to the bottom....it seems like a move.they tell you just to pack up and leave and they escort you out..and these people didn't do anything wrong (except maybe lose money)

Posted by interested, Jan 24, 2008 2:15PM

this may be a naive question (I am not in the business and I just came across this discussion after reading news reports)...but do they really just fire people without notice and no severance...and does it include people from across the board throughout the ranks..it seems like a bad movie.they tell the employee he or she is fired and escort them out..and these people really didn't do anything wrong except maybe lose money

Posted by update, Jan 24, 2008 2:46PM

any more layoffs today?

Posted by , Jan 24, 2008 3:00PM

sometimes they didn't even lose money. sometimes they were the best at what they do and made money for the firm. and yes, that's exactly what happens.

Posted by , Jan 24, 2008 3:15PM

sometimes they didn't even lose money. sometimes they were actually the best in biz at their job and made money. and yep, that's exactly how it happens.

Posted by interested, Jan 24, 2008 3:21PM

it seems like an amazing business...maybe my union job isn't so bad

Posted by Insider, Jan 24, 2008 4:10PM

Not getting much work done today. San Francisco research shut down 100% today. So, Houston, SF, Philly, and Atlanta sales are 100% gone. Chicago and Boston and NY sales trimmed. Total body count looks like something around 30-35% of the group. Confirmed that severence pay was something like 2 weeks for each year of in-service, bonuses were something like 0-5% of last year's bonus. Those who remain have been warned that some will be getting nothing for their annual bonus.

This is consistent with the charicature of Wall Street -- "eat what you kill" " all or nothing" "eat or be eaten". In reality, this is something of the past or that exists in bucket shops (churn and burn shops).

Memories are short when people hand out checks, so if boa stays with the business, I will bet you that within 3 years they will be handing out checks again to build the thing back up and lots of people will gladly accept those checks.

The people who are being let go in equities (sales, trading, research) are NOT the ones who lost all that money for Boa. This group grew revenue a LOT in 2007 (gained market share -- you'd never beleive it looking at the reaction). I guess the CEO needed a little out of everyone's pocket in order to get his payout.

Here's another site with info about the BoA people:
http://allthefunicanstand.blogspot.com

Posted by Insider, Jan 24, 2008 4:38PM

Not getting much work done today. San Francisco research shut down 100% today. So, Houston, SF, Philly, and Atlanta sales are 100% gone. Chicago and Boston and NY sales trimmed. Total body count looks like something around 30-35% of the group. Confirmed that severence pay was something like 2 weeks for each year of in-service, bonuses were something like 0-5% of last year's bonus. Those who remain have been warned that some will be getting nothing for their annual bonus.

This is consistent with the charicature of Wall Street -- "eat what you kill" " all or nothing" "eat or be eaten". In reality, this is something of the past or that exists in bucket shops (churn and burn shops).

Memories are short when people hand out checks, so if boa stays with the business, I will bet you that within 3 years they will be handing out checks again to build the thing back up and lots of people will gladly accept those checks.

The people who are being let go in equities (sales, trading, research) are NOT the ones who lost all that money for Boa. This group grew revenue a LOT in 2007 (gained market share -- you'd never beleive it looking at the reaction). I guess the CEO needed a little out of everyone's pocket in order to get his payout.

Here's another site with info about the BoA people:
http://allthefunicanstand.blogspot.com

Posted by CDO, Jan 24, 2008 5:41PM

anyone have any info on the London or Chicago CDO group or those from LaSalle's CDO group that were brought on board???

Posted by anonymous, Jan 24, 2008 6:40PM

i believe boa is out of the CDO biz now...

Posted by CJ, Jan 24, 2008 6:58PM

Doesn't BofA get its bonus paid out in the middle of the year? Its not the normal Dec year end.

Posted by anonymous, Jan 24, 2008 7:43PM

yes year ended in oct, but bonuses typically communicated in late jan and then paid out feb 15.

Posted by CJ, Jan 24, 2008 11:26PM

Doesn't BofA get its bonus paid out in the middle of the year? Its not the normal Dec year end.

Posted by CJ, Jan 24, 2008 11:32PM

Wow, so you need to wait 5 months to get your bonus paid???? Hmm...
Are associates the same way. I had an associate leave me for BofA and they gave him a signing bonus as he said they got paid in June/July? If thats the case, then its just the seniors that got the shaft.

Posted by Insider, Jan 25, 2008 12:32AM

FAs (lowest rung on the ladder) get paid a bonus mid-year. Everyone else gets it Feb 15.

Posted by Director, Jan 25, 2008 9:29AM

Insider is right. They generally fired some of the best performers in equity research and sales. Those were the people who helped build the investment bank and helped to make the firm money (and their division was NET income positive) but yet because they did so well, they also cost the firm a lot of money. So, Ken Lewis would rather just take off expensive heads, even though many of those people were the ones who did exactly what he wanted them to do. Ken Lewis will soon be taken down from his post - the bank is a joke.

Posted by former BofA, Jan 25, 2008 9:45AM

It seems that BofA is tryng to allign equity research to where they lend money or have investment banking. The people (whole teams) let go were some of the more expensive folks but not all were highly paid. I know for a fact that some were in fact well underpaid.
Insider is right FAs get a mid year bonus and many got huge bonuses last summer. Some could clear close to $300K in 12 months.
Insider is incorrect about women being more affected. While 1 DOR that was let go was a woman they kept the other woman. The one that was let go was for a reason, trust me. Men and women alike were laid off in all jobs.
I predict BofA goes the way of Prudential within 2 years. Buyside shops will have no use for them now that they have so many gaps in coverage.

Posted by CJ, Jan 25, 2008 10:23AM

former BofA... "some were underpaid", please; The market pays what they are willing to pay. If someone is underpaid on Wall St, its their fault, or their really not underpaid.
I can tell you,if your FA's were clearing $300k, then your seniors must START at double that, if not more.

The payroll for the research dept at BofA sounds like it got wildly out of control.
The only way you can support a high priced sell-side analyst is if they bring in banking business. ALA, Dana Cohen.
I have no nothing about the other II analysts that got booted, but if all they did was drive trading volume, at $0.02-$0.03 cents, they were overpaid.

I had to face the pay scales of BofA first hand, as I tried to keep my associate. However, massive base, signing bonus, guarantees, it was SO over the top. I can remember telling him that with such a cavalier attitude towards comp, its not going to last. Guess what, I was right.

Look, I am not trying to defend BofA for its highly unprofessional action of not paying people out, but I think we also need too look at this from a business perspective.

Posted by former BofA, Jan 25, 2008 10:47AM

One of the problems BofA had was that pay did get out way of hand. I could not agree more. Trust me existing employees were not happy about it. The difference between the average analyst and FA was not that large. Definitly not double. There is also an associate layer in between. Underpaid is a realtive thing on Wall street. If you are not happy with your pay you are free to walk across the street to another shop so you only have yourself to blame.
Like I mentioned in an earlier post they aligned the research biz with where they can drive revenues for the most part.

Posted by hrdnitlr, Jan 25, 2008 4:44PM

A few thoughts:

re Insider at 1/24 04:10 - I think the reputational issue (i.e., a background of laying people off, and screwing them on comp on the way out) is real. People do in some ways have short memories, but within a given product group (here, equity research), people on the Street definitely remember these things, IMHO. Granted, it's all a simple labor supply/demand thing, and money (and fat contracts/guarantees) talks, but I think the only way an organization gets around this down the road is if you have more industry consolidation. If there's fewer seats, period, out there, and BofA is back in the game, sure, I and anyone else looking to make a move would have to consider them. But if the pool of opportunities expands (e.g., more foreign banks entering the U.S.) even a little, anyplace with a bad reputation now is going to have a hard time paying up enough to get good people.

I think that somebody who's legitimately solid (not a newbie looking to prove himself) won't make a move for money alone, unless he feels pretty solid about the organization.

Also, on the topic of reputation: remember Stan O'Neal's savaging of fixed income at Merrill after the '98 crisis? I would argue that lots of people in the debt products on the Street remembered that. And when it came time for them to staff up bigtime in fixed income, I'd be willing to bet that that history of layoffs gave the best candidates pause before they jumped on board.

Posted by Tully, Jan 25, 2008 5:39PM

'98 Was Herb Allison, stand was filing still

Posted by $, Jan 25, 2008 5:57PM

What's avg Net Worth by title (Assc., VP, Dir, MD) in Bulge Bracket (range for seniority)?

Pls post based on your #, or direct knowledge not hopes/dreams or delusions/bitterness.

This is one # that everyone can crunch.

Posted by Jimmy Chie, Jan 25, 2008 8:16PM

Article is correct. Company is "resizing" (downsizing sounds too harsh) its CIB (Corporate and investment banking unit). I worked in the Asia office until Friday when I was laid off as a CIB banker covering MNC clients. Major cuts were made in the corporate finance, debt capital markets, and global markets groups. At least in Asia, BofA has literally exited any investment banking business and will be primarily focusing on bilateral loans and its treasury management (GTS) business.

to my count. Asia had around 200 front office people and i know personally of 15 who got laid off and heard another 15 got laid off in the GMG group.

Posted by edcvfrtgbn@hotmail.com, Jan 26, 2008 12:56AM

BofA is gone...dead in investment banking and anything related...they should have just sold the thing instead of screwing everyone. As far as Ken Lewis and the rest of the "executive" management team in Charlotte who doesn't know any more about banking than a typical savings and loan, screw them. I hope that they burn when their time comes and I hope that their time is slow and is as full of as much pain as they've inflicted on their "valued" (ex) associates.

Posted by buysider, Jan 26, 2008 11:47AM

BofA seems to be out of the CDO biznass all together. Still amazingly most of the team is still there...not sure why. I heard they canned their head of structured products McLaughlin (the guy below Hentemann). I know they whacked half of their synthetic CDO guys last week. Should be interesting to see who shows up in Vegas for ASF in the next week...