Wednesday, September 29, 2010
Oh no...another TARP Bank (Bank of America) cutting Proprietary Trading Jobs
Sept. 29 (Bloomberg) -- Bank of America Corp., the largest U.S. bank, is eliminating between 20 and 30 proprietary trading jobs to comply with Volcker rule limits on banks trading their own capital, according to a person briefed on the decision.
The cuts, which represent fewer than one third of the bank’s proprietary trading jobs, follow a decision this week to stop trading some liquid instruments, said the person, who declined to be more specific. Some of the affected employees are being encouraged to seek jobs within the bank, the person said, speaking anonymously because the matter isn’t public. The positions are in New York and outside the U.S.
“We continue to explore the best possible ways to comply with the Volcker rule and this is one step in that direction,” said Jessica Oppenheim, a spokeswoman in New York for the Charlotte, North Carolina-based bank.
Bank of America follows competitors including Goldman Sachs Group Inc. and JPMorgan Chase & Co. in taking steps to comply with the Dodd-Frank financial overhaul legislation passed in July. The Volcker rule, named after former Federal Reserve Chairman Paul Volcker, who proposed it, bans bank holding companies that have federally insured deposits from trading for their own accounts.
Bank of America’s proprietary trading business is run globally by David Sobotka. He’s a former Merrill Lynch & Co. commodities trader who later headed Merrill Lynch’s fixed-income trading division before taking charge of proprietary trading in August 2008. That was less than two months before Merrill Lynch agreed to be acquired by Bank of America.
The group was created to consolidate teams that traded the firm’s own capital in products including stocks, bonds, currencies and commodities. Sobotka remains in his position, the person briefed on the matter said. The jobs that are being cut will be fully eliminated in the fourth quarter, the person said.