WaMu to cut 1,000 jobs, add 1,000
Responding to the nationwide mortgage turmoil, Washington Mutual said Wednesday it would shutter one division that bought mortgages from...
Responding to the nationwide mortgage turmoil, Washington Mutual said Wednesday it would shutter one division that bought mortgages from other home lenders and another that financed mortgage companies.
The closures will mean the loss of about 1,000 jobs, WaMu spokesman Alan Gulick said.
However, the Seattle company plans to hire about 1,000 loan officers in the next few months in its home loan offices and bank branches, bringing the total to about 4,000, said spokeswoman Darcy Donahoe-Wilmot.
Earlier this week, Chief Executive Kerry Killinger told a Wall Street audience that WaMu would grow its loan portfolio by $20 billion this quarter; analysts expect it to add a similar amount to its books next quarter.
The idea, Killinger said, is to take advantage of WaMu's size and financial flexibility to gain market share at a time when many of its mortgage competitors are on the ropes.
"Some of the changes we've made today are in response to market conditions, but they're also about accelerating our growth," Gulick said. "We feel there is significant opportunity to leverage the power of WaMu's 2,200 retail stores."
Only about 75 WaMu employees in Washington state — nearly 60 of them in the downtown Seattle headquarters — will lose their jobs, Donahoe-Wilmot said.
They're among several hundred people who work in back-office jobs to support the company's home loan business.
Also included in the job cuts will be about 340 people in loan-fulfillment centers in San Diego and Anaheim, Calif., and in San Antonio; about 210 jobs in WaMu's capital-markets business; and 75 subprime-mortgage sales and support staff, Gulick said.
WaMu has been shrinking its mortgage business for more than three years, after the peak of a record refinancing boom in 2003.
Between June 30 and a year earlier, the staff at its home-loans group fell to 12,735, from 15,560, Gulick said.
Earlier this year, WaMu eliminated 460 jobs around the country that supported its subprime-mortgage business, which essentially has been put on ice during the current home-lending turmoil.
At least 100 mortgage companies have sought buyers or halted lending since the start of 2006, according to data compiled by Bloomberg.
A record number of Americans faced home foreclosures in the second quarter, the Mortgage Bankers Association in Washington, D.C., reported last week.
Countrywide Financial, the largest U.S. mortgage lender, said Sept. 7 it will cut 10,000 to 12,000 jobs.
Lehman Bros., the biggest underwriter of mortgage- backed bonds, and IndyMac Bancorp, the second-biggest U.S. home loan company, also announced job cuts that day.
Seattle Times business reporter Drew DeSilver and Bloomberg News contributed to this story. Drew DeSilver: 206-464-3145 or email@example.com
Copyright © 2007 The Seattle Times Company
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