Washington Mutual cuts 2,500 jobs

02/16/06 - newratings.com

NEW YORK, February 16 (newratings.com) - Washington Mutual (WM), the largest US savings and loan corporation, Wednesday announced 2,500 job cuts in the forthcoming five months.

Seattle-based Washington Mutual said it intends to layoff 2,500 support employees in its mortgage unit and to reduce its mortgage processing offices from 26 to 16. The job cuts represent about 4.2% of the company’s workforce of 60,000 employees. Washington Mutual’s spokesman Tim McGarry said the company’s ten largest offices being closed include the ones located in Chatsworth, Campbell, and Stockton, Dedham and Quincy, Lake Worth, Lake Oswego, Lancaster, Novi and Columbia, which employ 1,500 workers. Another 38 smaller offices in the US are to be closed, which would comprise another 500 job cuts, Tim McGarry added.

The company intends to reallocate the activities partly to low-cost domestic locations, while the rest is transferred to offshore locations, according to Reuters. MSN Money said the work from the offices to be closed would be shifted to the company’s remaining 16 offices in cities including Irvine, suburban Chicago and Jacksonville. Washington Mutual would be hiring in those offices to partly offset the layoffs, MSN Money added.

Washington Mutual’s share price rose $0.17 to close at $42.96 on the New York Stock Exchange on Wednesday.