Chemical, Hanover Laying Off Another 200
The scythe will swing again this week at Chemical Banking and Manufacturers Hanover Co., as the soon-to-be merged companies cut 200 more jobs on their way to trimming 6,200 from their combined work forces by 1994.
The cuts will come in the banks' corporate banking, merchant banking, and corporate finance segment, said John Stefans, Manufacturers' chief spokesman, who was appointed spokesman for the proposed new bank on Oct. 4. The cuts represent a 20% reduction in that sector, he noted.
"It's really an elimination of overlapping responsibilities," Mr. Stefans said, adding that cuts from Chemical and Manufacturers will be roughly equal.
"There is an extensive outplacement service set up," he said.
The banks have cut 944 jobs since announcing their planned merger last July 15, Mr. Stefans said. Of those jobs already cut, 463 came from Manufacturers and 481 came from Chemical, he said.
Mr. Stefans was unable to say when the next wave of cuts would hit, but he said, "Certainly right after the merger we would have quite a few."
The merger is scheduled for Dec. 31, and Mr. Stefans was unaware of anything that would impede it.
The Federal Reserve accepted the banks' merger application as complete on Oct. 24. The Fed now has all the information it needs to decide whether to approve the merger, he said. The shareholders from both banks approved the merger Nov. 1.
The $200 million of savings the banks projected in July for the first year after the merger has been adjusted to $225 million, though Mr. Stefans emphasized that both figures are raw estimates.
The banks say the merger will easily save $650 million by 1994, as projected last July.
"Our comfort level on a scale of one to 10 is a 10 in meeting that," he said.
The Bond Buyer is a sister publication of the American Banker.