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Bank of America still has an issue with people leaving

After announcing its fourth quarter results last week, Bank of America is due to announce its bonuses next week and when it does, there may be disappointment. Bank of America could benefit from disappointing a few people; they won't leave. 

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Speaking to investors on Friday, Bank of America CEO Brian Moynihan said he thought the bank's turnover rate was just 6% in the fourth quarter of 2023, half its usual rate of 12% and below the 7% average for the full year. The turnover rate is "very low," Moynihan observed.

The low turnover rate might be due to the pleasures of working for Bank of America, which has been investing in its markets business and says it's been gaining share in investment banking. However, it may also derive from a lack of alternative job opportunities and a semi-craven clinging to current roles. BofA isn't the only place to have a problem: Morgan Stanley and KPMG have complained of the phenomenon too. 

Moynihan didn't pontificate on the reason for employees' increased willingness to keep working for Bank of America. Nor did he say it was a bad thing. However, it was the low turnover rate that encouraged BofA to implement a semi-hiring freeze this time last year and as the turnover rate remains low, the implication is that this will remain in place. 

Instead of filling vacancies with people hired externally, Moynihan said last week that BofA has been "rolling over teammates from one business to another business" and "retraining people and reskilling people." AI could enable more of this redeployment in 2024, he added. Last year, M&A bankers in quiet markets who were used to working on big deals were encouraged to work with middle market clients instead. 

Despite its hiring freeze and internal redeployments, BofA has still been hiring quite busily. In 2023 Moynihan said 15,000 people were recruited across all business areas. This, however, coincided with a headcount reduction of nearly 5,000 people as the bank went from 218,000 employees in January '23 to 212,900 in December.

If 15,260 people left (7% of 281k) and 15,000 people were hired, the implication is that BofA also actively cut 5,000 people last year. CFO Alastair Borthwick nontheless said the cuts were achieved through "attrition" and that BofA managed to avoid paying "an outsized severance charge."

Could BofA benefit from more attrition in 2024? Maybe not right now. Borthwick said the presumption is that last year's markets revenues are a new normal and Moynihan said there's a "full pipeline" of investment banking deals that should soon take the bank back to $1.5bn in revenues even if there's a lack of clarity on when those deals will be done.

And if costs need to be cut? Moynihan said they can keep managing costs down by omitting to hire replacements for people who leave. This being so, it might still help if a few more people left in the first place. 

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Photo by Zachary Spears on Unsplash

AUTHORSarah Butcher Global Editor
  • co
    corp is crude
    4 March 2024

    Bank of America just fired me 30 days before my pertinently leave. I was the second person fired with "whatever" reason they put it on us. Worked there for 7 years and never got a written. Just crude.

  • Ad
    Adopted by LA
    8 February 2024

    When are investors are going to finally have had enough with Brian Moynihan and all of those who suck up to him? I worked for Bank of America for 25 years. My final two years there were unbearable! NOTHING gets done in that entire company without a crisis occurring. Middle Management is not promoted on the merits of leadership skills, but rather by sales performance. One only needs to look at the recent SEC fines that Bank of America has had to pay to see how well that’s going. They promote managers who game the system to inflate their numbers and that culture spreads across the departments with everyone applauding until someone gets caught. Well folks, let me tell you, water runs down hill. It starts with the leadership team and B of A.’s is a system of total corruption. Former Senior Leader Chris Shepler once bragged to me about what a family man Brian is. About how he made it a point to always be at home on Sunday and about how Nobel he was for refusing to pay for garbage service because he would rather take his own garbage to the dump himself. To which I can only reply to by asking what is a man making $30 million a year doing taking his own trash to the dump for? His garbage What’s he hiding in his garbage?

  • Bi
    15 January 2024

    BOF is like working for the government, you have a bunch of employees who basically do nothing all day, easily disappear, lucky if they get a few hours a day productivity, haven’t kept their skills current and can’t survive in the real world where accountability and performance are everything.

  • Co
    15 January 2024

    The reason why people do not leave BofA:

    They have a technology stack that is very specific to BofA, called Quartz, it is a basterdized version of Python. You do not use the regular packages such as Pandas/Numpy but they have their own way of coding. There is no Airflow instead they have bob-monitor, they do not use gitub again its their own version control system.

    They are using Hadoop but other then that there is no new technology stack. You basically have to spend evening and weekend constantly brushing up on actual Python to keep your skill up to date.

    Also the culture, fking lazy as hell, people log in at 9 and log out 5.

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