Cadence Bank could layoff as many as nine employees from its 11 Golden Triangle branches, a company spokesman said today.
Senior Vice President of Marketing John Boydstun said the Starkville-based bank is currently conducting productivity and efficiency studies aimed at reorganizing multiple aspects of company operations, including employees. The majority of the impact to employees will be restructuring job duties, but, “some employees will lose their jobs.”
“We don”t know specifically at which locations because we”re not at the point of finishing all reviews. In the Golden Triangle it could be somewhere around nine (employees),” said Boydstun.
He says Cadence managers and human resources officials will determine how many employees to lay off and when after the study has concluded. At that time the company will communicate to employees whether their jobs have been restructured or eliminated.
Boydstun says this is the first time in years Cadence has conducted an efficiency study on this scale. He declined to speculate how many total Cadence employees would be dismissed, or if those jobs would return.
“This is just part of dealing with the economic conditions that all businesses have been operating under in the last 18 months,” said Boydstun. “It”s always unfortunate if anyone loses their job in any business. We have to examine our business and see if there is duplication of areas and get things in the right perspective for our shareholders.”
Cadence, which has branches in Mississippi, Tennessee, Alabama, Florida and Georgia, has been struggling amid the downturn in the housing market, weighed down by construction and housing loans. The bank posted a $110 million loss in 2009.
The bank earlier this year established a special asset department, whose purpose is to deal with problem loans, bank President Lewis Mallory said in an interview earlier this year. The bank also added to its loan review area, made improvements to its lending policy and “moved aggressively to recognize issues in our loan portfolio,” Mallory said.
In January, two members of the bank”s board of directors, James D. Graham and Dan R. Lee, resigned their seats. In a letter to Mallory, which was filed with the Securities and Exchange Commission, Graham said his decision to resign was based on the unwillingness of Cadence officials to sell the bank.
Mallory said in January that the board considered selling the bank. “The board did consider selling and will probably consider it again in future time. They”re constantly weighing what is the best option for the shareholders,” he said.
Cadence is among the financial institutions nationwide that sought federal help through the Troubled Asset Relief Program. Cadence sold to the government $44 million in senior preferred shares that pay an annual dividend of 5 percent for the first five years.
In September, the company sold its insurance business, Galloway Chandler McKinney Insurance Agency, back to its original Columbus and West Point-based owners, about the same time the bank shelved a planned sale of stock in an effort to shore up its low stock price.
Cadence stock was up 1 cent at $1.55 this morning, down from a 52-week high of $5.29.
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