Comerica Inc., which has been behind schedule on its promise to eliminate as many as 2,000 jobs following its 1991 merger with Manufacturers National Bank, has begun wielding the ax with authority.
In the past two months, 180 employees -- 70% of them executive officers -- have received layoff notices from the Detroit-based bank, the first companywide since the merger 19 months ago. Some of those laid off had titles as high as executive vice president.
Most of the pink slips were handed out in Michigan. But Comerica said there were some staff cuts at its outposts in California, Florida, Illinois, and Texas.
Other Options Exhausted
On March 24, the bank company announced that layoffs would soon begin in earnest as part of a reorganization relating to the merger. Until then, Comerica had relied primarily on attrition and voluntary acceptance of early retirement and other severance plans.
A source at the company, which has $26.6 billion of assets, said many of the layoffs occurred in information services, electronic banking, corporate banking, and trust.
"We had our very own Bloody Tuesday," he said, referring to April 27, when he discovered his own boss was gone. "This was the first time middle and upper-level management was hit."
Cost Cuts Behind Schedule
Comerica laid out plans in October 1991 to cut $145 million of expenses over three years. But it recently acknowledged that cost cutting had been running about six months behind schedule.
A bank spokeswoman said the current round of job cuts has not been accelerated to make up for the six-month lag. "In a macro view of things, these [two issues] are related," she said. "But [the layoffs] are part of an evolutionary process."
Rather than naming specific employees who are being let go, Comerica has been sending out memos announcing new managers for certain areas, a source said.
"You had to read between the lines to see who was leaving," he said.
He added that the company was overstaffed at the managerial level, and praised Comerica for being direct in explaining why the layoffs must occur.
An article in Comerica's employee newsletter last month stressed the importance to the entire company of maintaining investor confidence.