Continental Bank to Revamp, Cut 900 Jobs
Continental Bank Corp. said Tuesday that it would cut 900 jobs and certain services, redrawing parts of a battle plan formulated by Chairman Thomas C. Theobald after a 1984 federal bailout.
After undergoing the largest bank bailout in U.S. history, Continental has focused on sophisticated corporate and institutional banking, downplaying the traditional consumer.
It maintains that its restructuring is not a change in basic strategy but a realignment of services with changing customer demands.
However, it is retrenching from a roughly three-year expansion into several specialized areas, particularly global trading services. About 60% of the job cuts will be from that segment.
The bank holding company, with assets of $31.3 billion, said it will set aside $50 million to cover costs of the cuts. As a result, it expects to post an unspecified second-quarter loss.
While analysts viewed the job and product reductions as essential to reducing expenses, they said the retraction may not be enough to improve the bank’s profit performance this year.
“I certainly expected something greater than 900 people,” said County NatWest USA analyst Stephen Berman. “I don’t know whether it’s enough.”