Bank of America shuts London commods trading desk

By Randy Fabi

LONDON (Reuters) - Bank of America (BAC.N) has shut its commodities and energy trading desk in London, becoming one of the first big investment banks to trim operations in these strong markets.

Companies have rushed into commodities to take advantage of soaring prices, but the global credit crunch and a U.S. economic slowdown have forced some firms to retrench.

The second-largest U.S. bank said on Thursday it will close its London commodities and trading desk and centralise operations in New York.

The action was part of its announcement last week to eliminate 650 corporate and investment banking jobs.

"I can confirm that our (Europe, Middle East and Africa) commodities team has been impacted by the changes we announced last week," said spokeswoman Elizabeth Wood.

"Our core commodities clients are U.S.-based corporate and commercial entities, so to create operational efficiencies and better serve them we are centralising our commodities platform in the U.S.," she added.

Wood declined to say how many jobs were affected by the shutdown of London's commodities trading desk, which took place on Wednesday.

The Charlotte, North Carolina-based firm started trimming its metals trading operations in late 2007, just a year after it entered the market.