Francine Knowles

August 23, 2007

 

Bank
of America Corp.’s $21 billion acquisition of LaSalle Bank Corp. would
result in the net loss of more than 10,500 jobs and more than $780
million in lost earnings in a two-year period, according to a report
released Wednesday by local community groups.

The
report also estimates that state and local governments would collect
roughly $16 million less in tax revenue in 2008 and roughly $32 million
less in 2009.

It was prepared by Anderson Economic Group and commissioned by groups including Woodstock Institute, Citizen Action Illinois and the Service Employees International Union Local 1.

The
report projects as many as 3,900 of 4,000 jobs at LaSalle’s Chicago
headquarters, most of them high-paying, would be cut, and 1,118 branch
employees’ jobs would disappear in the Chicago area. It estimates more
than 6,000 jobs would be lost indirectly in other industries. 

Bank
of America Chairman Ken Lewis told the Chicago Sun-Times earlier this
year job cuts will hit LaSalle’s headquarters hard with management,
call centers, information technology and legal, finance and compliance
departments expected to take the brunt.

On Wednesday, the Federal Trade Commission cleared the deal.

Coalition
representatives voiced concerns that Bank of America would cut local
investment and philanthropy and accused the company of charging
excessive fees and having a poor record in lending to African Americans
and Hispanics.

LaSalle Bank has been cited for its
philanthropy, including being named the United Way of Metropolitan
Chicago’s Top Corporate Citizen. In 2006, LaSalle committed roughly
$300 million in community development loans, according to its 2006
annual report. LaSalle Bank supported 230 organizations with grants to
nonprofits totaling $1.5 million in Chicago and Michigan in 2006, said
Woodstock Executive Director Malcolm Bush.

The
coalition is seeking a commitment from Bank of America to preserve jobs
and to at least maintain current philanthropic giving levels, he said.

They
cited Bank of America’s acquisition of FleetBoston Financial Corp. in
2004. Amid community pressure, Bank of America altered merger plans to
preserve jobs and boosted community economic development investment,
Bush said.

Meanwhile J.P. Morgan Chase & Co.,
as part of its acquisition of Bank One Corp., agreed to a detailed
six-year plan covering small-business lending, grants and investment in
local communities, he said.

It’s premature to detail job cuts, Bank of America spokesman Scott Silvestri said Wednesday.

“We’re
very interested in retaining key associates across the organization,”
he said. “Once the transition is completed we’ll be a stronger company
that will contribute to the growth of the local economy.”

He
declined to comment on whether Bank of America would agree to match
current philanthropic giving levels or respond to criticisms regarding
fees or the bank’s lending record in minority communities.

Earlier this year, Bank of America said that since 1995, it has donated more than $30 million in Illinois, mostly in Chicago.

Bush
said the coalition has asked the Federal Reserve Board to hold a
hearing on the merger to allow public comment on the local impact.

A Federal Reserve Board spokeswoman said Wednesday if the board decides to hold a hearing, it will announce that.

The coalition also is seeking a congressional hearing.