Bank of America

(BAC) - Get Bank of America Corp Report

is cutting staff in its investment banking unit as a slump in equity markets continues to weigh on profits.

Banc of America Securities

, the investment banking and brokerage arm of Charlotte, N.C.-based Bank of America, cut 32 positions, including five research analysts, 22 research associates and five salespeople, according to a person close to the situation. There are 1,500 employees in the equity division. The cuts were made in the company's New York and San Francisco offices late last week, this same person says.

A Banc of America Securities spokesman wouldn't discuss the layoff number but confirms there were "reductions, mainly due to market conditions," and says the firm decided to "selectively reduce staff but had no specific goals for headcount." He adds the cuts are "in line with industry" trends.

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In recent years many commercial banks have branched out beyond traditional services such as lending in hopes of boosting profits with the lucrative fees that accompany investment banking services. But a slowing economy and weak equity markets have given banks another headache to deal with recently.

Bank of America jumped into the equities business in 1997 when it snapped up

Montgomery Securities

for more than $1 billion. Now global, corporate and investment banking, of which equities is part, accounts for about 30% of cash basis earnings -- about $645 million in the latest quarter.

Still, year-over-year growth has been sluggish, as evidenced by the latest quarterly results. Global investment banking revenue rose a modest 6%, to $1.41 billion. Meanwhile, cash-basis earnings, a term the bank seems to like throwing around, slipped to $325 million from $332 million. (Cash basis is an accounting system in which revenues are recognized only when cash is received and expenses only when they are actually paid.)

Like a number of its financial counterparts, Bank of America has been playing up first-quarter results up by comparing them to the even weaker fourth quarter, a trend that seems to be

catching on in the industry lately. Look no further than this subheadline in the company's latest earnings release: "Key First Quarter Performance Drivers (Compared to Fourth Quarter 2000)."