National City Job Cuts

Another major lender has announced massive layoffs and the suspension of its third-party brokered mortgage operations.

National City Corporation, one of the 10 largest banks in the country, will eliminate 900 jobs. The cuts will affect approximately one-seventh of the bank's mortgage staff and is the second major layoff in a little over a year. In the second half of 2006 it cut 2,500 positions as it merged its home equity and mortgage lending operations and stopped making some types of loans.

The bank also cut its common stock dividend from .41 to .21 and said it plans to seek more capital to cope with deteriorating credit markets.

National City, based in Cleveland, has about 1450 branches located primarily in the Midwest. However many of its loans are for homes in Florida, Ohio, and Michigan where foreclosures have been among the highest in the nation.

And, just to show that the subprime mess is affecting people and institutions in places one would never have imagined a few months ago, CNBC is quoting from a leaked internal memo from executives at Bank of America. As a result of the banks recent losses, CNBC said, an order has come down to eliminate certain small, formerly free employee amenities. Among those mentioned were low-fat milk, sugar-free cocoa and soap.

Stock in the company that makes Purell immediately soared but apparently executive washrooms and executive salaries were spared any cutbacks.