Wachovia Unsuccessful In Bid To Beat Bank of America In Incompetence

Author:
Publish date:

Wachovia said today that it wrote down $1.3 billion in loans and other securities in the third quarter, which contributed to a profit decline of ten percent. WB’s net income was $1.69 billion (89 cents/share), down from last year’s $1.88 billion ($1.17/share). Analysts had predicted that the bank would perform worse, quarter-on-quarter, but had underestimated how much worse, forecasting earnings of $1.03 per share. Investment banking declined a respectable (compared to 93 percent) 80 percent, to $105 million, from last year’s $533 million. Chief Executive Officer Kennedy Thompson called the results ``disappointing,” especially for those Wachovia employees who will be laid off as a result.
Wachovia's Net Falls 10% On Loan-Loss Provisions [WSJ]

Related

Bank Of America Hoping To Fire Thousands Of Employees In Record Time

Remember Project New BAC, i.e. Bank of America's plan to transform itself from Ken Lewis's house of fun, where everyone went home happy but the concept of making money was less of a focus than keeping the good times coming, to an institution that did things like post profits? The bank has said previously that PNBAC "will result in $8 billion in annual savings by 2015—$5 billion from the first phase and $3 billion from a second phase" and while it stands by those figures and remains committed to cutting as many employees as it takes, some people would like them to be a bit snappier about it. Bank of America is accelerating a broad cost-cutting plan and has set a target of shedding 16,000 jobs by year's end—cuts that would see the company relinquish its title as U.S. banking's largest employer. The proposed year-end total of 260,000 would be the lowest count since 2008 and likely give Bank of America a smaller workforce than JPMorgan Chase, Citigroup, or Wells Fargo...Chief Executive Brian Moynihan is trying to speed the company's transformation into a smaller and more efficient operation as he tries to persuade investors that expenses can be adjusted to compensate for revenue lost to new regulations, an uneven economy and shaky markets. Since becoming CEO in 2010, he has shifted away from a nationwide expansion strategy embraced by his predecessors Hugh L. McColl Jr. and Kenneth D. Lewis, and shed many of the businesses that he considers to be nonessential...Hitting the new staffing target would fulfill a year early Mr. Moynihan's pledge to slash the bank's workforce by approximately 30,000. "If they want to make any headway toward improving profitability," said Sterne Agee & Leach Inc. senior banking analyst Todd Hagerman, "they need to accelerate the timeline." Bank Of America Ramps Up Job Cuts [WSJ]