AIG Wholesale Lending Operation Done

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6 · 17 · 08

The wholesale lending arm of American General Finance Inc. is calling it quits.

Wilmington Finance Inc. will immediately end wholesale mortgage banking originations, an announcement today said.

Around 335 employees will be laid off as a result of the closing.

Wilmington, based in Plymouth Meeting, Penn., originates nonconforming residential loans through retail, wholesale and correspondent channels.

The company closed a number of retail calling centers two years ago, resulting in 100 layoffs — leaving it with around 1,600 employees at the time. Today’s statement noted a reduced retail operation will be maintained.

Existing loan commitments in the pipeline will be honored, Wilmington said.

Parent American General Finance is a subsidiary of troubled American International Group Inc., which also owns mortgage insurer AIG United Guaranty. AIG, which reported a $7.8 billion first-quarter loss as a result of $9.1 billion in unrealized market-valuation losses, fired on Tuesday its president and chief executive officer, Martin Sullivan.

Replacing him was Chairman Robert Willumstad, who oversaw mortgage lending at Citigroup prior to joining AIG in 2006. It had been speculated that Willumstad would boost the company’s mortgage presence.

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Mortgage Daily Staff