Chemical, Hanover Trim Securities Units
Chemical Banking Corp. and Manufacturers Hanover Corp. laid off 12 municipal securities professionals and 18 other executives last week from their soon-to-be-melded securities subsidiaries.
The banks are pursuing a restructuring as part of the merger they announced on July 15. They are expected to cut 6,200 employees of their combined 43,000. About 1,000 have been let go so far, according to spokesmen for the banks.
On the Chemical side, none of its 14 municipal bond professionals were affected, but three bankers and a clerk were let go from its 18-member public finance department, sources said. Some of those released had accepted severance packages.
At Hanover, two of 12 public finance bankers and one clerk were dismissed. Its municipal bond department was hit the hardest, losing seven of its nine professionals, sources said.
New Section 20 Unit Planned
The rest of the layoffs from the securities subsidiaries covered other areas, including asset-backed and mortgage-backed securities, the spokespeople said.
A spokeswoman for Chemical said the merged banks would have about 50 professionals in the municipal securities department working in a new Section 20 subsidiary, which will continue to carry the Chemical Securities Inc. brand.
Clarence Otis, who has served as vice president and manager of public finance for Chemical Securities, will head public finance, according to a spokeswoman for Chemical Banking.
In addition, William Jester of Chemical Securities was named to oversee municipal underwriting, trading, and sales. Loren D. Carlson, a managing director and head of Manufacturers Hanover's public finance department, will manage new business and report to Mr. Otis.
Mr. Otis and Mr. Jester will report to Thomas Becker, a managing director with Chemical Securities, who will now be responsible for all fixed-income and money-market dealings, except government securities, the Chemical Banking spokeswoman said.
William Pike, who headed the government desk at Manufacturers Hanover, will oversee government securities in the new subsidiary, the spokeswoman said.
David Green, the head of Chemical's government bond department, is expected to resign in January, sources said. The Chemical spokeswoman declined to comment.
Further Cuts Likely Today
Market sources said there could be big cuts in the government securities department at Chemical and the cuts could be announced today.
Also last Thursday, the New York State Banking Board said it approved the merger of Manufacturers Hanover into Chemical Banking.
To date in 1991, Chemical ranked 25th as a senior manager of long-term municipal bonds, with 55 issues totaling $1.19 billion, according to Securities Data Co., an American Banker affiliate. Manufacturers Hanover Securities was ranked 31st, with 25 issues totaling $852 million.