SunTrust Banks Inc. is undergoing another round of cuts in its mortgage operations, including 100 jobs in Richmond, a company spokesman said Wednesday.
The cuts here are part of 800 jobs nationwide that the bank is eliminating over the next several months as a result of a slowdown in mortgage refinancing activity.
“The 800 jobs are in addition to what we have already done,” said SunTrust spokesman Mike McCoy, referring to 100 jobs that were trimmed across the country this summer in its mortgage operations.
Atlanta-based SunTrust’s mortgage division is based in South Richmond.
McCoy said he did not know how many people locally work at the division. But the bank employed the full-time equivalent of 4,400 people for all of its operations in the Richmond area at the beginning of the year.
A total of 4,200 people nationwide work in its mortgage operations, he said.
“We expect attrition to account for a portion of the job cuts,” McCoy said. “The cuts reflect market conditions, particularly the reduced value of mortgage refinancings.”
He said employees were told last week about the 800 job cuts. But many people affected by the announcement will be notified toward the end of October that their jobs are being eliminated, McCoy said.
“They will be able to post for other positions at SunTrust and, if they are displaced, severance and outplacement assistance will be provided,” he said.
With mortgage interest rates rising and cutting off demand for refinance activity, major U.S. lenders have made similar cuts.
They include Charlotte, N.C.-based Bank of America Corp. and San Francisco-based Wells Fargo & Co., other major employers in the Richmond area.
Bank of America cut 40 positions this year at its Villa Park operations center in Henrico County. It eliminated 2,100 jobs nationwide and closed 16 mortgage offices, including one in Fairfax.
Wells Fargo recently cut 2,323 mortgage positions, including 15 in Virginia Beach.
U.S. banks boosted their mortgage staffs in recent years to meet higher demand for mortgage refinancing. While mortgage interest rates remain near historic lows, they have risen in the past five months.
Although mortgage interest rates have been drifting down in the past couple of weeks, the average rate for a 30-year fixed-rate mortgage was 4.32 percent, up from 3.42 percent in early May, according to Freddie Mac.
For a 15-year fixed-rate mortgage, it was 3.31 percent last week, up from 2.61 percent in May.