Job Cuts

Wells Fargo and JPMorgan reported record profits last year, aided by refinancings and a rebound in sales and prices. Now, mortgage lenders are paring staff as higher interest rates cast doubt on how much the housing market will improve. Wells Fargo plans more than 2,300 job cuts and New York-based JPMorgan may dismiss 15,000 by 2014.

About 1,500 of the Bank of America workers set for termination helped process home loans, said one of the people, who asked not to be named because, while affected employees were notified Aug. 29, the scope of the plans hadn’t been publicly announced. About 400 worked in a suburban Cleveland call center, and 200 dealt with overdue mortgages, the person said.

The changes “reflect our ongoing efforts to streamline our facilities and align our cost structure with market realities,” said Terry Francisco, a spokesman for the bank.

Shrinking Countrywide

The lender targeted three offices in California as well as locations in Virginia, Washington, Texas and Ohio, according to employee discussions held last month, said the people. Some will be offered work elsewhere in the firm, the people said. Bank of America’s staff totaled more than 257,000 at mid-year.

Chief Executive Officer Brian T. Moynihan, 53, is again scaling back operations gained in the 2008 takeover of Countrywide, once the biggest U.S. mortgage lender. After shuttering reverse-mortgage and correspondent-lending units in 2011, the firm targeted smaller ex-Countrywide offices to close or consolidate, said one of the people.

Regulators and lawmakers blamed Countrywide for lax standards and predatory lending that contributed to the housing bubble and collapse, which has cost Bank of America more than $45 billion. Countrywide was acquired under Moynihan’s predecessor, Kenneth Lewis.

“We’re pretty much through the refi boom, and we don’t know yet what the purchase business will look like,” said Nancy Bush, founder of NAB Research LLC, a bank research firm in New Jersey. “Countrywide was everywhere, so Bank of America’s particular challenge is to go from this hot-mess mortgage company to a rational one.”

The cuts will leave about 25 mortgage offices, said one of the people. The suburban Cleveland site, which had 1,000 employees, lost the most people, said the person. That part of the reduction was reported last month by the Plain Dealer.