Bank of America will lay off 30,000 more employees, it was announced on Monday. The crippled banking giant is desperately attempting to improve the bottom line before investors give it the Greek treatment.

But is it a sign that the whole banking sector is worse off than thought? Last month, Bank of New York Mellon said it needed to slash 1,500 jobs. State Street Corp. said it would cut and outsource 850 jobs.

But for Bank of America, the cuts may be irrelevant to its plight. The corporation is saddled with untold billions of dollars’ worth of delinquent mortgages, at a time when the economy is deteriorating again.

Bank of America would probably already have collapsed, except that government regulators changed “mark to market” accounting rules to allow the “too big to fail” banks to obfuscate how insolvent they really are. However, in Bank of America’s case, the accounting gimmicks do not appear to be enough. Its share price has fallen from $50 to around $7. Meanwhile, the company faces so much litigation relating to how it operated its mortgage business in the past that this alone could force the government to step in and seize the bank.

According to bank analyst Christopher Whalen, “Bank of America is rearranging chairs on the deck of the Titanic. And firing thousands of people who don’t need to be fired.” It is the mortgage problems that need to be addressed, he says.

But Bank of America needs to be perceived as taking action on its profitability issues. The bank is dangerously dependent on continually finding new lenders to pay off previous lenders as its short-term loans come due. If confidence in Bank of America continues to erode, it wouldn’t take much to put this bank over the edge.

If Bank of America fails, a lot of other American banks will be affected too.

But the next big threat to America’s banking system could come from Europe.

“We’re getting close to a full-blown banking crisis in Europe,” said Pacific Investment Management Co.’s Mohamed A. El-Erian. “We are in a synchronized global slowdown. There’s very little confidence in economic policymaking both in Europe and the U.S.”

America’s exposure to Europe could be greater than many expect. Back in June, the Bank for International Settlements released a report detailing how much exposure U.S. banks have to Greek debt. American financial institutions have sold billions of dollars’ worth of insurance on Greek loans. If those loans go bad, U.S. banks will be on the hook for them.

If, for example, Greece ends up defaulting on its debt, American financial institutions will probably have higher losses than even German banks.

Since June, it is possible that American banks have reduced their exposure, but at a time when America’s banking system is still struggling to recover from its mortgage mess, a European banking crisis could still easily cause chaos in America.

Bank of America’s troubles could easily be just the tip of an iceberg.