(September 21) – “The megamerger creating J.P. Morgan Chase & Co. will trigger fewer pink slips than some on Wall Street had expected,” writes Jathon Sapsford in today’s Wall Street Journal.

“At a London news conference, William B. Harrison Jr., chief executive of Chase Manhattan Corp., said the banks would cut as many as 3,000 traders, bankers and support staff. The disclosure marked the first time the two banks have released an estimate of how many employees might be dismissed after the closing of the $34 billion deal, announced last week.”

“The announced layoffs, which total about 3% of the combined staff of 95,000 employees, are far fewer than the 10,000 or more job cuts that some Wall Street executives had predicted. And they significantly trail the 12,000 cuts Chase announced when it merged with Chemical Bank in 1995.”

“This time around, Mr. Harrison said, the two banks have less overlap, largely because J.P. Morgan & Co. has little in the way of a retail-bank franchise. Most of the cuts are likely to be in areas with significant duplication, including the 32,000 bankers and support in businesses like trading and lending. ‘This [merger] is not about a lot of layoffs,’ Mr. Harrison said. ‘It’s about growth.’ “

“Mr. Harrison wouldn’t provide details. But the most obvious area of potential overlap is the firms’ bond businesses. Those familiar with the talks leading up to the merger say that overlap was a big stumbling point for many suitors that looked at J.P. Morgan.”

“Several departures have already been announced. Just prior to the merger, J.P. Morgan’s chief financial officer, Peter Hancock, left the firm, and Neal Garonzik, Chase’s current head of asset management, also said his role at the firm would end with the merger.”

“Most of the remaining members of the executive suites will stay, with the biggest cuts coming in the rank and file. The banks have yet to say when most of the cuts will happen. But officials familiar with the matter expect such an announcement within a month.”

“J.P. Morgan has tried for years to develop its investment-banking business. But despite moves to hire analysts, stock-underwriting specialists and merger-and-acquisition bankers, the wholesale lender failed to crack the big leagues of Wall Street investment banks. That was one reason J.P. Morgan sold itself to Chase, rather than electing to merge with it as an equal, analysts say.”