The financial services sector is laying off more workers as mergers continue to force banks to streamline their operations.

Bank of America Corp. announced Thursday that it will cut an additional 4,500 jobs as a result of its merger with FleetBoston Financial Corp. It already had plans to lay off 12,500 employees.

Meanwhile, industry experts await the outcome of J.P. Morgan Chase & Co. and Bank One Corp.’s restructuring plan. The combined banks expect to lay off 12,000 employees by the end of 2006.

The job cuts are nothing out of the ordinary, said Scott Alaniz, who studies the banking industry for Sandler O’Neill & Partners LP. Duplicate jobs, improved technology and the need to maintain a competitive edge are all forcing financial institutions to look at their bottom lines.

“Big companies grow their earnings by cutting costs and getting rid of people,” Alaniz said.

But the days of keeping most employees from the acquired company are gone.

Today, management is under more scrutiny to take a closer look at all operations and do what’s best for the new company, said Frank Anderson, a senior equity analyst with Southwest Securities Inc. in Dallas.

“It’s cold and cruel to lay a bunch of people off, but from a business standpoint, you are competing,” he said.

The new layoffs, which will occur across the company in primarily support positions such as finance, marketing and technology, start this month, said Bank of America spokeswoman Alexandra Trower.

The company, based in Charlotte, N.C., has been eliminating duplicate positions for six months, but it declined to say where and how many jobs have been cut so far.

Because it is a competitive market, industry leaders, like Bank of America, are having to rethink their business models, said Scott MacDonald, president and chief executive of the Southwestern Graduate School of Banking Foundation.

“It’s not good news for those who are losing their jobs, but it does show that the banks are thinking,” MacDonald said. “One person with technology can do the work of two or three.”

Trower said Bank of America’s reorganization and the fluctuations of the business cycle – particularly the rise in interest rates reducing mortgage activity – are driving the additional layoffs. She would not say if more job cuts are expected.

It is common for merging companies to keep laying people off until they have finished consolidating.

In fact, when Chase and Bank One merged earlier this year, the companies said as many as 10,000 job cuts were possible nationwide. A couple of months ago that number was increased to 12,000.

The banks have already laid off about 2,400 employees nationwide, Chase and Bank One spokesman Chris Spencer said.

“It’s all about productivity gains,” Anderson said. “As there are more consolidations there is going to be continued pressure on job levels.”