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| US mortgage lender slashes jobs | US mortgage lender slashes jobs |
| (about 5 hours later) | |
| The biggest mortgage lender in the United States, Countrywide Financial, says it is making big job cuts. | The biggest mortgage lender in the United States, Countrywide Financial, says it is making big job cuts. |
| Countrywide's Chief Executive, Angelo Mozilo, said the company, based in California, was being forced to cut up to 12,000 jobs, one-fifth of its staff. | Countrywide's Chief Executive, Angelo Mozilo, said the company, based in California, was being forced to cut up to 12,000 jobs, one-fifth of its staff. |
| Mr Mozilo said the firm had been badly hit by the US house price slump and the increasing number of buyers who are defaulting on mortgage repayments. | Mr Mozilo said the firm had been badly hit by the US house price slump and the increasing number of buyers who are defaulting on mortgage repayments. |
| The firm expects new mortgages to fall by 25% in 2008, compared with 2007. | |
| "During the past two years the growth in home price appreciation has stopped dead in its tracks," wrote Mr Mozilo in a letter to staff, "and in many areas of the country it has turned in the wrong direction." | "During the past two years the growth in home price appreciation has stopped dead in its tracks," wrote Mr Mozilo in a letter to staff, "and in many areas of the country it has turned in the wrong direction." |
| In recent weeks Countrywide borrowed over $11.5bn (£5.6bn) and sold a $2bn stake to Bank of America so it could keep operating its retail banking and mortgage lending businesses. | In recent weeks Countrywide borrowed over $11.5bn (£5.6bn) and sold a $2bn stake to Bank of America so it could keep operating its retail banking and mortgage lending businesses. |
| As of July the company employed more than 61,000 people although about 1,400 posts were eliminated in the last few weeks. | As of July the company employed more than 61,000 people although about 1,400 posts were eliminated in the last few weeks. |
| Countrywide shares have fallen 57% this year. | Countrywide shares have fallen 57% this year. |
| "As we carry out our plan, the company's overarching focus is exactly where it has always been: to remain an industry leader in the US residential lending business," said Mr Mozilo. | "As we carry out our plan, the company's overarching focus is exactly where it has always been: to remain an industry leader in the US residential lending business," said Mr Mozilo. |
| The company's problems reflect an industry-wide slump in response to the housing crisis, says the BBC's Peter Bowes in Los Angeles. | The company's problems reflect an industry-wide slump in response to the housing crisis, says the BBC's Peter Bowes in Los Angeles. |
| Dozens of lenders have either cut back operations or left the industry altogether. | Dozens of lenders have either cut back operations or left the industry altogether. |