|Brian Moynihan of Wellesley became CEO in late 2009.|
Lender has shed 2,000 jobs in state
But Bank of America remains committed to region, CEO says
Bank of America Corp. the state’s biggest bank, has eliminated roughly 2,000 jobs in Massachusetts over the past four years, company officials acknowledged yesterday.
Chief executive Brian Moynihan said in a speech in Boston yesterday morning that the bank had 7,000 workers in the state. That’s down from 9,000 in August 2007 and 8,000 last year.
Bank spokesman Joseph Goode said the bank’s employment in Massachusetts is lower for several reasons, including the sale of its Columbia Management mutual fund business last year and the elimination of redundant positions after Bank of America bought Merrill Lynch & Co., the Wall Street investment bank, two years ago. The bank has also eliminated some of its smaller branches and found other ways to become more efficient as it coped with the economic downturn.
“These are typical employment fluctuations, given the significance of the Merrill Lynch and Columbia transactions and the natural ebb and flow in a challenging economy,’’ Goode said.
Moynihan mentioned the bank’s local employment number during a speech yesterday at a breakfast event sponsored by Northeastern University. Moynihan, the Wellesley lawyer who rose to be bank president and chief executive a little more than a year ago, did not elaborate on the declining employment during his speech, or to a reporter afterward.
He did, however, say in his speech that Bank of America remains committed to the region, about seven years after the company bought New England’s largest bank, FleetBoston Financial. In addition to maintaining thousands of jobs in the state, Moynihan also noted Bank of America spent $12 million on philanthropy in Massachusetts last year and $5 billion on community development projects, including loans for development in lower income neighborhoods.
“We will continue to be here for a long time,’’ Moynihan said.
Bank of America is the latest major financial company to acknowledge it has substantially reduced employment in the Bay State. Fidelity Investments recently announced plans to close an office in Marlborough by the end of next year and eliminate or move most of the 1,100 jobs to locations out of state. The Marlborough closing would bring Fidelity’s employment in Massachusetts to 7,300, down from 13,000 in 2006. And in November, Boston-based State Street Corp. announced plans to cut 1,400 jobs, including 400 in Massachusetts.
Nevertheless, Massachusetts has been gaining jobs overall, including more than 15,000 in February. The state’s unemployment rate, as of February, was 8.2 percent, its lowest since May 2009, and below the national average of 8.9 percent for that month. And last week, Bank of New York Mellon Corp. announced plans to move 200 jobs from Rhode Island to Westborough.
One of the biggest employment changes at Bank of America comes from its sale of the long-term asset management business of its Columbia funds unit, for $1 billion to Ameriprise Financial Inc. At the time of the closing last May, Columbia had more than 500 workers in Boston.
In December 2008, Bank of America announced plans to eliminate roughly 10 percent of its workforce, or 35,000 jobs worldwide, because of the weak economy and its acquisition of Merrill Lynch. The company has also reduced the number of offices in the state from 309 in 2008 to 285 last year, according to the Federal Deposit Insurance Corp.
In his speech, Moynihan also ticked off a number of signs that the US economy is improving overall, including lower jobless claims, more initial public offerings, and rising consumer spending.
But Moynihan said the bank continues to struggle with foreclosures and troubled mortgages.
“The problem with delinquent mortgages and falling home values has led to a very difficult situation that we face as a country,’’ he said. “So helping to solve it is a top priority. We continue to make progress.’’
Moynihan said US banks have modified 4 million mortgages since 2008, including more than 800,000 at Bank of America alone, to help borrowers stay in their homes. But more than half of those helped wound up defaulting again.
To help deal with the problems, Moynihan said the bank has more than doubled the size of its staff that works with distressed homeowners to about 30,000 workers nationwide. And it has set up consumer assistance centers around the country — including one opened in Dedham last year — where homeowners can work with bank representatives.
Todd Wallack can be reached at firstname.lastname@example.org.