Bradford & Bingley cuts 370 jobs
Article source: www.news.bbc.co.uk
Mortgage lender Bradford & Bingley (B&B) is cutting 370 jobs because of the continuing downturn in the market for mortgages.
It is shutting a mortgage processing centre and cutting its sales team that deals with mortgage brokers.
It is also making its remaining 50 branch mortgage advisers redundant.
The lender said the moves were due to "the wider economic environment and the significantly reduced volume of new mortgage applications".
More job cuts are in the pipeline, the lender said, when it has finished a review of staffing at its head office.
"We are a strongly capitalised bank now undertaking a complex transition with regrettable job losses," said Richard Pym, the recently-appointed chief executive.
"But we are planning to put the problems of the past behind us and have a business which is fit for purpose going forward."
Credit-worthiness
The past week has seen widespread concern that the B&B may be the next bank that needs to be rescued by the authorities because of the credit crunch.
Its credit-worthiness has been downgraded by all three of the main credit ratings agencies: Moody's, Standard & Poor's, and Fitch.
Each has pointed to the bank's problem in raising funds in the financial markets and the excessive exposure of its mortgage book to buy-to-let and self-certified borrowers.
Shares in the lender are currently at a record low of just 23 pence, after standing at 184p in May.
Arrears
Three hundred of the staff being made redundant work at the bank's mortgage processing department at Borehamwood in Hertfordshire.
They will lose their jobs in the first three months of next year when their work is transferred to a larger office at Bingley in West Yorkshire.
B&B said it had no plans to cut any High Street branches and would be taking on 70 new staff to collect repayments from the growing number of borrowers who are now in arrears.
This week, Her Majesty's Revenue and Customs (HMRC) reported that residential property sales in the UK stood at just 62,000 in August, down by 54% on a year earlier.
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