Beachwood, Cleveland is the latest city affected by major banking layoffs, this time courtesy of Bank of America (BofA). Both the mortgage and consumer banking areas of BofA are the ones being shuttered, with the firing of around 1,000 employees by the end of October. A total of three Bank of America offices are being shuttered, two in the Cleveland area, and one in the Cincinnati area.
Bank of America released the following statement: “We continue to reduce the size of our mortgage servicing operations in line with the successful reduction of our portfolio of delinquent mortgage customers. Compared to peak levels in 2011, today we have fewer than one-third the numbers of customers who need the specialized programs and support of this team. These actions also reflect our ongoing efforts to streamline our facilities and align our cost structure with market realities, including declining refinance volume resulting from rising interest rates.
"Bank of America has a strong track record for helping our employees identify opportunities both inside and outside of the bank and we are working closely with leaders in the community to support a smooth transition. We remain committed to Ohio and continue to refine our business model to account for changes in the marketplace to both preserve our presence and plan for the future."
Beachwood Mayor Merle Gorden tried to spin the departure of BofA in a positive way, stating: "While we are always very disappointed to hear of any job cuts, we view this as a temporary setback, the Cleveland Clinic owns the two buildings housing the affected Bank of America facilities. The Cleveland Clinic has thriving operations in Beachwood and we are optimistic that they might be able to expand into this space."
“Unfortunately, this kind of thing happens when the cycle changes in our industry. I feel badly for the people who have been let go. However, there is a silver lining to this event,” said Bob Rubin, managing director of The Business Loan Connection in Detroit. “There are a lot of new and existing companies that are looking for talented mortgage professionals.”
State Sen. Nina Turner (D-Cleveland) has assured the state that she will continue working with Bank of America to keep their remaining jobs in Ohio, however; she is apparently “extremely disappointed,” with Bank of America’s decision to leave so many without jobs by the end of October. Last month, Bank of America made headlines when it began facing a storm of litigation from various government entities regarding its shady regulatory activity.