Industry News

IndyMac Bancorp announces 2,400 layoffs

CEO predicts another 500 to 1,000 job cuts needed

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IndyMac Bancorp Inc. said Tuesday it would cut 24 percent of its staff -- some 2,403 workers -- and forecast that 2008 loan volume will fall to $43 billion, or less than half the business the alt-A lender did two years ago. IndyMac said it will close regional wholesale mortgage centers in Tampa, Philadelphia, Boston, Columbia (S.C.) and Kansas City (Mo.) by the end of the quarter, consolidating their operations into 11 other regional centers around the country. In an e-mail to employees, IndyMac Chief Executive Officer Mike Perry said another 500 to 1,000 layoffs could be required in the first half of the year in order to return the company to profitability. IndyMac must limit growth its balance sheet because it is unable to sell many of the prime, jumbo loans it originates on the secondary market, he said. "The private secondary market remains virtually frozen," Perry said, and the market suffered another setback in November when Fannie Mae and Freddie Mac tightened gu...