Wells Fargo exits mortgage joint venture businesses
Wells Fargo (WFC) announced plans to withdraw from eight joint ventures in the mortgage lending space.
The decision is effective immediately and is expected to gradually be completed over the next 12 to 18 months.
The withdrawal is based on the current regulatory and market environment as changes in state and federal oversight have increased the complexity and difficulty of operating its joint mortgage ventures.
"This decision reflects our response to new operating realities and our commitment to continuously improving our business model," said Franklin Codel, executive vice president and head of mortgage production.
He added, "As a leader in home lending, we want to ensure we're always in the best position to help Americans achieve the dream of homeownership."
As of the second quarter, the joint ventures contributed 3% of Wells Fargo's mortgage production.
Appromixately 300 employees will be impacted, but the decision does not impact the mega bank's retail and correspondent mortgage businesses.
"Our Wells Fargo Ventures team is committed to delivering exceptional service and strong financial results as we wind down the business. We will also work to retain as many impacted team members as possible through other opportunities at the company," said Jim Stavenger, senior vice president, head of Wells Fargo Ventures.