Responding to the cooling housing market, Washington Mutual Inc., the largest U.S. savings and loan, said Wednesday that it was laying off 2,500 support employees in its mortgage unit.
The Seattle, Washington-based company said it was also reducing the number of mortgage processing offices to 16 from 26 and sending some of the work to “lower cost domestic and offshore locations.”
The cuts were expected. Last month, when Washington Mutual reported fourth-quarter earnings, it said it would move some operations to lower cost cities inside and outside the United States to reduce overhead.
At the time, the bank said it expected its current overseas workforce of 1,700 full-time employees would more than triple to 6,000 within two years.
Like its rivals in the home lending business, Washington Mutual is dealing with a drop in activity as interest rates rise and the housing market cools.
In the most recent quarter, Washington Mutual said that revenue from the sale and servicing of mortgages tumbled nearly 47 percent $264 million during the fourth quarter.
In a statement, Washington Mutual said the latest move ”reflects the company’s ongoing focus on adjusting the cost structure of its home loans business and effectively managing capacity to better match current and anticipated mortgage market conditions.”
