Bank of America said Monday it would cut 2,100 jobs from its home mortgage unit as a key driver of the business, refinancing, has slowed down with higher interest rates.
Dan Frahm, a spokesman of the country’s second largest bank, also explained that it needs less staff than in the past to deal with loan defaults that the bank inherited with its takeover of subprime lender Countrywide.
The bank only needs about one-third of the number of people that it had working on home loans at the peak after the housing crisis, he said.
In August, Wells Fargo, now the country’s largest bank generator of mortgage loans, announced it was cutting 2,300 people from its home finance business, also pointing to the fall in refinancings due to the impact of rising interest rates.
[Image via Agence France-Presse]