Calabasa, Calif.-based Countrywide Financial Corp. has announced plans to address changing market conditions, in part due to the subprime mortgage meltdown. As part of the plan, the company said it would be reducing its workforce by a total of 10,000 to 12,000 employees in the next three months.
Countrywide said the reductions represent about 20 percent of its workforce, and “will occur in areas most impacted by lower mortgage market origination volumes.” Actual reductions could be lower if the interest rate environment and related market volume outlook improve, the company said. “Based on current interest rate levels, Countrywide presently expects that total market origination volumes will decline approximately 25 percent in 2008 compared to 2007 levels,” it said in a statement.
Other steps as part of Countrywide’s plan to address changing market conditions include:
- Migrating the residential lending business into its federally chartered thrift entity;
- Revising product guidelines to ensure that all loans that the company produces can be sold into the secondary market or are high-quality prime loans to be held in Countrywide Bank’s investment portfolio;
- Continuing growth in areas of opportunity, such as retail and wholesale lending divisions and Countrywide Bank.
Countrywide owns Balboa Insurance Group.
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