It has discontinued its home originations segment
Santander Bank NA, a Spain-based global banking group with more than 2 million customers in the US, has discontinued its residential mortgage and home equity originations segment – a move that’s already triggered layoffs, Mortgage Professional America has learned.
“We have discontinued residential mortgage and home equity originations as we continue to focus on investing in products that have scale and that leverage our core strengths,” company spokesperson Nancy E. Orlando told MPA in response to questions. “This move will allow us to unlock capital to fuel our growth. We remain committed to our clients, small businesses and the communities we serve and are ensuring that our current clients and those in our pipeline are not impacted.”
MPA previously reported that Santander Holdings USA, Inc. – a subsidiary of Madrid, Spain-based Banco Santander – notified state officials in Philadelphia of its plans to lay off 53 of its employees by April 08. The layoffs are expected to be permanent, according to the notice filed in compliance with the Worker Adjustment and Retraining Act (WARN) filed with Philadelphia Department of Labor and Industry.
Orlando was readying a response to questions from MPA detailing the reasons behind the cuts. She subsequently sent answers to MPA’s questions on Wednesday morning. Gathering from her response, the 53 job cuts in the Philadelphia region may be just the tip of the iceberg.
Read more: Santander reveals job cuts
“Unfortunately, this does impact employees, and we estimate that less than 4.5% of the bank’s (SBNA) employees will be impacted,” Orlando wrote. “We are fully supporting our colleagues with severance benefits, career transition services, and opportunities to pursue other open roles at Santander.”
Orlando described the company’s broader plan of action in the US: “The Santander US strategy is to simplify our business. We have stopped new originations of home mortgage and home equity loans because the company hadn’t achieved scale in those areas and the capital and resources could be better spent on other areas, such as auto lending and segments of business and commercial banking.”
MPA learned that the Santander US strategy is to simply its process, stopping new originations of home mortgage and home equity loans because the company hadn’t achieved scale in those areas. Moreover, the firm decided capital and resources could be better spent on other areas, such as auto lending and segments of business and commercial banking.
The company is one of several that have disclosed job cuts in the wake of higher interest rates. The online real estate marketplace company Zillow Group Inc. continues to lay off workers after the failure of its Zillow Offers home-flipping product, with 55 additional job cuts expected by April. In correspondence to state officials, the company wrote of plans to cut 19 jobs in Tampa, Fla., by April 18, and 36 more in Centennial, Colo., by March 21.
The company revealed the layoffs in separate correspondence to the Florida Department of Economic Opportunity and Colorado Department of Labor and Employment. The firm disclosed the imminent layoffs in compliance of the WARN Act.
Read next: California mortgage firm lays off more than 50 workers
California-based Winnpointe Corp., doing business as Interactive Mortgage, plans to lay off more than 50 employees by April, according to a WARN notice filed in its home state. The company this month notified the Employment Development Department of the imminent layoff of 51 workers in compliance with the Worker Adjustment and Retraining Notification (WARN) Act.
