|On the brink of being acquired, First NLC Financial Services has consolidated operations and laid off almost half of its staff in the process.
The nonprime lender closed about 23 retail branches and now has approximately 25. The closings contributed to about 640 employee layoffs yesterday, Andrew Henschel, First NLC vice president of corporate governance, told MortgageDaily.com Thursday.
“Although unfortunate,” the moves “were made to ensure the success of First NLC in the long term and to compete in the current market place,” Henschel said.
“Our industry is having a downturn,” he explained, noting as well a “deal that was made” last week.
On July 26, parent Friedman, Billings & Ramsey Group Inc. announced it will sell First NLC to Sun Capital Partners in a deal expected to finalize next quarter. Friedman acquired First NLC in early 2005 and started exploring strategic alternatives to maximize the subsidiary’s value early this year.
The consolidated retail centers were in various locations around the country, including some in Florida and Illinois, Henschel said.
In addition to the retail offices, the layoffs occurred throughout an operations center in Anaheim, Calif., and First NLC’s headquarters, which moved from Deerfield to Boca Raton, Fla., in June, according to the executive.
The layoffs were across all avenues of the company, including sales, operations, and both retail and wholesale employees.
Approximately 700 employees remain between Boca Raton, Anaheim, and the remaining retail locations, Henschel added.
First NLC, which reportedly generated about $7.4 billion in mortgage volume last year, had offices in over 40 states, according to its Web site.
“We do not foresee future layoffs or closings,” Henschel said. “We are committed toward the success of First NLC for the long term.”
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