The credit crunch has hit banking sector payrolls. Let the downsizing begin.

(Reuters) - Merrill Lynch & Co (MER.N) plans to announce about 1,600 layoffs after disclosing fourth-quarter write-downs, CNBC reported on Thursday. The layoffs are likely to be in trading positions and related areas, and will not likely include the investment banking or private client groups, CNBC's Charlie Gasparino reported. Merrill Lynch had about 64,000 employees as of the end of September, so 1,600 layoffs would represent less than 3 percent of its work force