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The latest Se r v ic i ng Or ig i nat ion SERVICING Wells Fargo Unloads $41 Billion in Servicing Rights s e c on da r y m a r k e t a na ly t ic s The major bank continues to reduce its portfolio. Thousands of Jobs Cut at Two Big Banks Citi and Bank of America both announced plans to reorganize as a result of the dwindling refinance demand. S ources at Citigroup and Bank of America (BofA) say the two banks are planning to lay off thousands of mortgage workers over the next several months as refinance demand spirals down. According to a report from Fox Business, executives at Citi told reporters the company will cut an estimated 2,200 jobs from its mortgage business "by early next year" due to rising mortgage rates driving down demand. "We recently announced the closing of the CitiMortgage 44 | The M Report Danville, Illinois, facility due to decreased refinance volumes, and discontinued some telesales positions," Mark Rogers, Citi's director of communications, told Fox Business. Rogers added the bank has nothing further to announce at this point, though he said Citi is "taking steps to make sure [its] mortgage business is sized correctly" in response to low refinance volume. Meanwhile, Bloomberg reported that Bank of America is cutting 2,100 jobs and closing 16 offices by the end of last month, W according to "two people with direct knowledge of the plan." Approximately 1,500 of the workers set to be laid off helped process loans, Bloomberg reported. About 400 worked in a Cleveland call center, and 200 handled overdue mortgage cases. Other affected locations include three offices in California and locations in Virginia, Washington, Texas, and Ohio— leaving about 25 mortgage offices, sources told Bloomberg. Citi and BofA aren't the only banks to be impacted by rising interest rates and improved loan performance. Reports in late August indicated JPMorgan Chase and Wells Fargo are both preparing to cut loan production and assistance jobs. It isn't just the biggest banks having to make cuts: Virginia's Richmond Times-Dispatch reported that SunTrust Banks, Inc., plans to eliminate 100 mortgage jobs in its centers across the country. ells Fargo is reportedly preparing to sell mortgage servicing rights (MSRs) on $41 billion worth of loans. Sources told Bloomberg the country's biggest residential servicer is getting set to sell MSRs on some of its governmentbacked loans. A Wells Fargo spokesperson declined to comment to Bloomberg on the sale, but CFO Tim Sloan revealed at an investor conference earlier in the week that the bank intends to sell off servicing rights during the next few quarters "as a risk management practice." "So if we ever get into a period where we have to sell, we've already gone through the process because it's just good from a risk-management standpoint," he said. Sloan also noted that if the bank does sell some of its servicing rights, the focus will be on non-core borrowers—that is, those who only have mortgages from the bank—limiting potential confusion "from a relationship standpoint."