Bank of America, one of the few major Wall Street banks to avoid mass job cuts in recent months, has begun moving investment bankers into busier areas as the industry deals with a slowdown in dealmaking and capital markets.
For years, the company has relied on attrition as a way to manage headcount, Chief Executive Officer Brian Moynihan said in an interview with Bloomberg Television. But after resignations fell to a percentage in the “mid single digits” — down from about 12% pre-pandemic — the bank is now looking to move staffers into divisions that are more active.
“We’re redeploying people across the franchise, including investment bankers to other parts of the franchise to help us in the middle market investment banking,” Moynihan said.
Bank of America and its rivals have been grappling with an industrywide slowdown in merger activity as central banks’ aggressive push to raise interest rates and the potential for a global recession strain capital markets and stymie dealmaking.
While large corporate clients remain cautious, mid-size companies have become more active. At Bank of America, the firm has worked on 40 deals so far this year with an average size of $1.4 billion. That compares with 50 deals by the same point in 2022, and an average deal size of $2.4 billion throughout last year, according to data compiled by Bloomberg.
Bank of America stopped hiring new workers late last year, Moynihan said. The company, which ended 2022 with 216,823 workers, has seen staffing levels drop by “a few thousand” in recent months, he said.
Moynihan was speaking from an investor summit his firm is hosting this week in Paris, where headcount has soared in recent years as the bank sought to comply with new regulations in the aftermath of Brexit.
The bank last month began prohibiting employees from using artificial intelligence tools such as OpenAI’s ChatGPT for business purposes. The technologies have quickly become an internet phenomenon for their ability to generate text in response to a short prompt.
Moynihan said his bank already uses AI and predictive technologies throughout the firm, though it runs on systems that are permitted to house internal data. The move to limit OpenAI’s technology was largely due to technical issues with the security of the systems, though Moynihan predicted the bank will ultimately get a license to take advantage of it more fully.
“This is now a new one, it could change the game,” Moynihan said. “That’s just working through the security thing.”
