Industry News

New Century files for bankruptcy protection, lays off 3,200

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Troubled subprime lender New Century Financial Corp. announced Monday that it has filed for Chapter 11 bankruptcy protection, laid off 3,200 workers, and agreed to sell its servicing assets and servicing platform. The Irvine, Calif.-based company said the layoffs, representing 54 percent of the company's work force, were effective immediately. The layoffs would "properly size" the company's servicing and originations businesses "for possible sale," New Century said in a press release. Filing for bankruptcy protection "provides the best means for selling our servicing and loan origination operations to financially sound parties," said New Century President and Chief Executive Officer Brad Morrice in a statement. "It is our hope that potential buyers will be in a stronger position than we are to employ many of our associates on an on-going basis." New Century said it has secured $150 million in "debtor-in-possession" financing from the CIT Group and Greenwich Capital Financial Products ...