Wells Fargo & Co. is cutting several hundred jobs in its home-mortgage business across the country, including 130 in the Twin Cities, as it continues to grapple with falling demand.
The nation’s largest home lender reported a 43 percent drop in revenue from home-loan originations and sales during the first three months of the year. The downsizing announced last week, coming just before the end of the second quarter, suggests the business continues to sag.
Wells Fargo and other home lenders broadly are grappling with the effect of rising interest rates and, in many urban areas like the Twin Cities, ultralow supplies of homes for sale.
Wells Fargo’s home-mortgage business is based in Des Moines, but it has a sizable presence in the Twin Cities, with several thousand people in Bloomington, Minneapolis and other local offices. The layoffs locally are concentrated in St. Louis Park, part of a broader cut of 400 jobs nationally, including at offices in Charlotte, N.C., and Frederick, Md.
“The decision to reduce our workforce is made with great concern for our team members,” the company said in a statement. “Wells Fargo Home Mortgage is committed to retaining valued team members and, where possible, we will work to identify other opportunities within Wells Fargo.”
The company provided a 60-day notice to employees and notified state employment offices in the various locations.
The affected Wells Fargo workers are eligible for pay and benefits through Aug. 19 and, if they don’t get another job within the company, may be eligible for separation benefits based on how long they have worked for the company.
“We will do everything we can to make them aware of other job opportunities within Wells Fargo, or support them as they transition to the next phase of their careers,” the company said.
Separately, Wells Fargo on Monday introduced a new credit card rewards program, joining a race with other major banks to provide benefit-heavy cards. The nation’s biggest bank, JPMorgan Chase & Co., has built its credit card business in recent years with extensive travel and entertainment benefits.
Wells Fargo said it will soon introduce a no-fee credit card that offers three points per dollar spent on dining, traveling and streaming services like Netflix.
The move comes after the Federal Reserve earlier this year placed a cap on asset growth at Wells Fargo until it can prove its governance and risk controls have improved following its sales-practice scandal.