National City Corp. will fold its home equity unit into its mortgage subsidiary -- resulting in hundreds of layoffs.
The Cleveland-based company announced today that its wholesale National Home Equity business unit will be integrated into National City Mortgage Co.
While some account executives and sales managers will join the mortgage unit's wholesale division, the remaining jobs will be eliminated, the statement said.
About 300 employees will be laid off in 60 days when the unit shuts down, The Plain Dealer reported.
The home equity unit suspended new business last week, the company told MortgageDaily.com.
"This is one of a number of steps National City has taken in recent weeks to help ensure that originations are in line with existing and anticipated market conditions," the lender said last week.
Despite the closing of the home equity unit, National City Mortgage still intends to offer home equity loans once "market conditions warrant," today's statement said.
The decision apparently does not affect the bank's 1,300 retail branches -- which will continue to offer equity lines, the company said.
"This decision was not taken lightly as it impacts many of our colleagues whose hard work and dedication helped drive profitable growth during the mortgage and refinancing boom in recent years," National City Vice Chairman and Chief Financial Officer Jeffrey D. Kelly said in today's announcement.