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Layoffs Watch: Merrill Pink Slips 500, Thousands More To Come

LayoffsMeanMoreTimeToDrink.jpgMerrill Lynch gave the boot to 500 people in its trading division today, according to CNBC. These layoffs come on top of the 4,500 people already let go by Lehman. And this is just the tip of the iceberg. Thousands more are coming.

Dick Bove today issued a note estimating that 10,000 jobs will eventually be cut by Merrill as it merges with Bank of America.

"Bank of America's 'slash and burn' style following acquisitions is likely to be pronounced at Merrill,'' Bove wrote. "That company still has approximately $30 billion in securities that could be written down. It overlaps with Bank of America in multiple divisions.''

And Bove may actually be underestimating the slash and burn. We ran the numbers a few days ago and arrived at twice as many layoffs from a combined Merril and Bank of America. If Bove's numbers are correct, about 10,000 BofA jobs are going to be cut also

Right now Thain is saying that many of the cuts will come from back office and IT. But he'd have to say that anyway to prevent defections from people in financial services. When Bank of America really starts cutting, it’s going to get ugly.

The total layoffs at Merrill since the crisis began last year now stand at around 5000, with about half of those in New York.

To our friends at Merrill: try not to think too much about John Thain’s buddy getting tens of millions after a year on the job.

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