Union Bank Lays Off 51 at Computer Center

Union Bank acknowledged Friday that 51 employees in its computer center have been laid off and that further staff cutbacks are under consideration.

The data processing employees, who work in the computer center in Monterey Park, were told late Thursday afternoon that they were being laid off. The total of 51 represents 12% of the employees in the operation.

Several sources within the bank said that the layoffs were believed to be the first round in a series of staff reductions. However, a spokeswoman for Union Bank said no decision has been made about additional cutbacks.

Susan Murdy, the spokeswoman, said the layoffs were part of normal streamlining efforts at Union Bank, the state’s fifth-largest bank, with assets of about $9.3 billion. However, the cutbacks took on added significance in many quarters of the Los Angeles-based bank because employees have been nervous for months about its possible sale.

Union Bank is owned by Standard Chartered of Britain. The parent firm announced last September that Union Bank and its Arizona affiliate, United Bank of Arizona, were for sale as part of Standard Chartered’s effort to raise funds to cover loan-loss reserves.

Union Bank officials have acknowledged that the bank is on the block but they have refused to discuss matters related to negotiations. Wells Fargo Bank of San Francisco and the world’s largest bank, Dai Ichi Kangyo Bank of Tokyo, have been suggested as possible buyers.

A Japanese banking source in Los Angeles said Friday that Dai Ichi Kangyo had withdrawn from acquisition talks recently after deciding that it could not handle such a large expansion into the United States market at one time.

The source said, however, that at least one other Japanese bank with stronger California links had recently expressed interest in Union Bank. He declined to identify the bank.