Bank of America Corp., Wells Fargo & Co. and JPMorgan Chase & Co. are among financial firms that added employees last year as the industry adjusted to an expanding economy and demands imposed by new U.S. regulations.
Bank of America, the biggest U.S. lender, counted 288,000 employees in its annual report for 2010 to securities regulators, an increase of 4,000, or 1.4 percent. Wells Fargo, the biggest U.S. mortgage lender, increased headcount by 4,900, or 1.8 percent, to 272,200, according to its annual report. Bank of America’s workforce increased 17 percent in 2009, the year when Merrill Lynch & Co. was added, while San Francisco-based Wells Fargo dropped almost 5 percent that year.
Banks reported a 77 percent increase in earnings in 2010, according to data compiled by Bloomberg. Improved asset quality and a decrease in loan-loss provisions contributed to the earnings growth, according to a report last week from the Federal Deposit Insurance Corp. Bank of America, based in Charlotte, North Carolina, put aside $28.4 billion for bad loans in 2010, down 41 percent.
“There was good talent out there at the right price,” said Eric Moskowitz, head of market intelligence in the global financial-markets practice of Los Angeles-based executive search firm Korn/Ferry International. “A lot of banks cut pretty deep in 2008 and 2009, and they needed to staff-up.”
JPMorgan, the second-largest bank, may file its annual form 10-K later today. Data accompanying the New York-based company’s fourth-quarter earnings report in January showed 239,831 employees, an increase of almost 8 percent from a year earlier.
American Express, the biggest credit-card issuer by purchases, increased its workforce by 2,700, or 4.6 percent, to 61,000 in 2010, according to a filing today by the New York- based firm. In 2009, the staff shrank 12 percent. Citigroup Inc., the third-largest bank by assets, cut jobs by 5,300, or 2 percent, to 260,000 in 2010. New York-based Citigroup has been shrinking as it recovers from the financial crisis.
Banks are adding employees to help ensure they’re in compliance with new laws such as the Dodd-Frank overhaul of the financial industry that passed last July, Moskowitz said. The act creates a consumer bureau at the Federal Reserve, a council of regulators to monitor firms for systemic risk to the economy and a mechanism for liquidating large financial firms whose collapse could threaten economic stability.
“It’s a very nuanced regulatory environment, not just for the U.S., but globally, so you need people on the ground in different regions because the regulations are so in flux and varied,” Moskowitz said.
Bank of America, ranked second in home loans and first in mortgage servicing, hired and trained about 12,000 people to modify loans over the past two years to help homeowners struggling to keep up with payments. About 58,200 were employed in the home loans and insurance unit, according to the filing.
© Copyright 2014 Bloomberg News. All rights reserved.