BANK of America Corp, the second-biggest US bank, fired about a quarter of stock analysts in its securities unit, according to industry insiders.
Robert Morris, the top-ranked oil and gas analyst for six straight years in Institutional Investor magazine's survey, and John McDonald, the second-ranked large-cap bank analyst in 2007, were among those cut yesterday, the former analysts told Bloomberg News.
The firings come a week after North Carolina-based Bank of America said it planned to eliminate 650 jobs in its investment banking unit. The company recorded US$5.28 billion of mortgage-related writedowns in the fourth quarter following the collapse of the subprime loan market.
"There will be gaps in coverage," said Jack Ablin, who helps oversee US$55 billion as chief investment officer of Harris Private Bank, which owns Bank of America shares. "They've got to reconcile their expenses, and this is part of doing business."
Paula Dominick, Bank of America's head of research, referred a call to spokesman Brandon Ashcraft, who confirmed that some of the 650 jobs eliminated at the company were analysts. He declined to name the analysts or say how many were fired.
"Debt and equity research remain core components of the products and services we offer," Ashcraft said. "We continue to provide research on hundreds of individual equity and debt securities across all major sectors."
Bank of America had 72 stock analysts as of last month, according to an equity research note it published in December.
The bank is also reducing its research sales staff in Atlanta, Boston, New York, Philadelphia and San Francisco, according to the former employees.