Saturday, October 3, 2015

Bank Of America Most Likely To Announce Job Cuts


Bank of America's possible cost cutting measures are anticipated in times ahead.

Bank of America Corp. is most likely to announce job cuts across its banking and trading sector, as reported by Wall Street Journal. According to the sources close to the matter, the bank will be laying-off few hundreds of employees.
As per Bloomberg, dozens of workers are most likely to be reduced. Two senior employees being dismiss include Alison Ferreira and Frank Laino, as anonymous sources told Bloomberg. Lately, New York Post also told that the American bank is expected to announce substantial layoffs.
Meanwhile, Federal Reserve has made it clear that it will stand perfectly on the current interest rate condition until inflation increases more than its present level and international concerns lessen, banks are struggling to increase their earnings. This added with the fact that federal authorities have constricted fees and regulations from trading segment follow a plunging path, banks have approved different measure to tackle the situation. Cost reduction measures have been the main preference in most of the banks.
At times lately, it was made clear that majority of big banks are planning to cut its cost. With various schemes that match their operations, applications differ from branches link to workforce cut. Moreover, banks have also tried to keep their liquidity high, and might increase their investment when interest rates increases.
Bank of America has found it more difficult than its industry peers to enhance its stock price and revenues. Bank of America stock news revealed that its investment and trading unit revenue witnessed a decline in second and third quarter. Chief Executive Officer, Brian Moynihan has strained the stance of the management in the past to emphasize on cost reduction in difficult times. Most of the analysts are in favor of these steps and believes that the bank has the capability to cut its expenses more.
According to the consensus expectation on Bloomberg, analysts believe BofA will report earnings of 0.35 per share in the upcoming quarter. Revenue is most likely to stand at $20.1 billion, slightly less than 3QFY14 revenue.
Talking about corporate governance worries, the bank held a vote for its stakeholders to make a decision regarding Mr. Moynihan’s double role of CEO and Chairman. The voting results came out in the favor of Mr. Moynihan as the shareholders support the management’s decision.
As per the analysts polled on Bloomberg, 28 gave it a Buy, nine recommended a Hold, while the remaining three rated Bank of America stock as Sell. The 12-month stock price target is $19.40.
The stock was up 1.37% to $15.56 at yesterday market close.



No comments:

Post a Comment