FYI… From the ML-Implode main site. This was not an ‘if,’ but rather a ‘when.’ -Best, Mr Mortgage <>
We are hearing about the impending shutdown of wholesale mortgage operations at Wachovia. This morning, we received the following:
“Wachovia wholesale is shutting down today. Press release at 1PM.”
“All us reps were told this morning by top managment that wholesale will be completely shutdown by August 31st and a conference call will be this afternoon. All reps were called Sunday afternoon on the east coast…both Portfolio and marketable products.”
The info is coming in from various sources including tipsters, forum members and outside sources – many of whom are (or were) Wachovia employees. We have no detailed information at this point on the number of people who will be affected.
An email sent to brokers by one AE says:
“Good Morning just wanted to let you know that we learned last night that today Wachovia will announce its closing its Wholesale division.
There will be a conference call at 1 pm and I will send out a follow up to that call.”
From their web site: “Today’s Wachovia was created when First Union Corporation acquired the former Wachovia Corporation and changed its name to Wachovia.” That merger occurred in September of 2001; some may also recall First Union’s acquisition (and subsequent shutdown) of then-subprime-giant “The Money Store” just a year prior. Many analysts and pundits have pointed to Wachovia’s acquisition of Golden West Corporation, parent holding company of World Savings Bank in Oakland, CA in October of 2006 as a cause for recent woes over their $120 billion portfolio of Pay Option ARMs, referred to as “Pick-a-Pay” or “PAP” loans.
Wachovia Corporation will be announcing their second quarter earnings tomorrow, 2008-07-22. From an AP article on Yahoo!Finance:
“Wachovia said it has set aside $4.2 billion pretax to cover bad loans for the quarter, leading to an estimated second-quarter loss of about $2.6 billion to $2.8 billion, or between $1.23 and $1.33 per share, excluding a goodwill write-down.”