The last time Wells Fargo was involved in an ongoing bloodbath this big, bandits were robbing its stagecoaches. The lending giant announced Thursday that it would cut 1,800 jobs in its mortgage unit. That’s in addition to the 3,000 mortgage employees the bank has already laid off in recent months, according to a Reuters report.
On Wednesday, the bank handed out 60-day notices to employees who’d been pink-slipped, according to Reuters. Wednesday’s cuts are just the latest in an ongoing downsizing of Wells Fargo’s mortgage unit as higher rates strangle the demand for refinancing.
At an investor conference Sept. 9, Chief Financial Officer Tim Sloan said the bank had already laid off 3,000 mortgage employees. Sloan also said the bank expected to see its revenue from home loans fall 30% in the third quarter, Reuters reported.
The bank is also reported to be selling off mortgage servicing rights by the ton. Bloomberg reported last weeks that Wells Fargo would be selling servicing rights on $41bn worth of government-backed mortgages – primarily mortgages of “non-core” borrowers, so identified because they have few products from the bank besides their mortgages.
Sloan had already hinted at the sale in the Sept. 9 investors’ conference.
“Look for us to potentially do something in the next couple of quarters,” he told investors. “It will be primarily focused – if we go ahead and execute – on mortgage-only customers, so we don’t have any confusion from a relationship standpoint.”
Wells Fargo, the country’s fourth-largest bank and largest home lender, made more than one out of every five home loans in the United States in the second quarter, according to Reuters.