Veterans of past downturns fearlessly predicts last week that the U.S. investment banks would cut back on Canadian content as one way of dealing with the credit crunch. It didn't take long for those predictions to come true. Bank of America, whose CEO famously remarked in October that he'd had "all the fun I can stand in investment banking" - yesterday chopped its corporate finance and M&A teams in Canada as part of a larger move to trim 650 global capital markets jobs, or 12 per cent of its investment banking work force. (CEO Kenneth Lewis has since said he regrets making that remark.) The bulk of senior investment and corporate bankers were let go in Canada; according to sources at the bank, this was less than 20 professionals. Bank of America representatives said they remain committed to domestic clients. But this bank now employs the suitcase approach to deals, covering Canadian corporations by flying in experts from its U.S. offices. Bank of America tried to win business with its balance sheet, using loans to Canadian corporations as one way of opening doors. That's a tough way to do business in a credit market downturn, and the bank is known to have lent money to Quebecor World, which filed for creditor protection on Monday. Bank of America's domestic operations are based in Toronto, with offices in Montreal, Calgary and Vancouver. Most of its estimated 300 employees are involved in personal banking, including credit cards. In the U.S. market, it is also primarily focused on consumer banking.
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