Bank of America clarifies report of branch closings

CHARLOTTE -- But the bank does not have a specific number of branches that will ultimately compose its franchise, and there's no immediate plan to close 10% of the bank's branches, said Bank of America spokesman James Mahoney.

"In response to a question from an investor on the magnitude of branch closings, (CEO Ken) Lewis did acknowledge that the range could be potentially 10%," Mahoney said.

Mahoney made the comments when asked about a published report that Lewis and another bank executive described a plan to cut 10% of bank branches to investors at a meeting last week in Charlotte, N.C., where the bank is based.

The move would be a pullback from the bank's two-decade expansion, from coast to coast.

"What took place was a discussion about the long-term direction of the company," Mahoney said. "Over the longer-term, as customer demands evolve, we see a fewer number of branches that provide more services."

Liam McGee, president of Bank of America's consumer and small-business bank, was also part of the meeting, Mahoney confirmed. The Wall Street Journal said in Tuesday's edition that McGee cited changing customer preferences for the move and noted more people are using online and mobile banking.

The news comes as Bank of America continues to be under the careful watch of the U.S. government, while it works to integrate two recent deals.

Bank of America acquired troubled mortgage lender Countrywide Financial. last summer and investment bank Merrill Lynch in January.

Those acquisitions have proven challenging for Lewis, who was stripped of his chairman title by a shareholder vote at his company's annual meeting in April.

The bank and Lewis have been under intense scrutiny because Bank of America is one of the biggest recipients of taxpayer bailout money — $45 billion — and because the losses at Merrill Lynch turned out to be much higher than expected. It is not known when it will repay the government.