HSBC Holdings (HBC) confirmed Wednesday that it will cut roughly 325 U.S. jobs as part of an exit from wholesale/correspondent mortgage lending; the London-based bank shut down lending activity via third-party brokers on Tuesday afternoon. Among the cuts will be 100 account executives that worked with brokers nationwide, or all HSBC account execs; another 225 jobs will be lost at the firm’s Depew, New York-based office, Bloomberg News reported. The company is far from the first to make such an exit, and the decision largely has not come as a shock or surprise to anyone that worked as a broker with the firm. “Frankly, I’m surprised they held on as long as they did,” said one California-based mortgage broker, who asked not to be identified. The move comes after behemoth Citigroup Inc. (C) significantly scaled back its presence in the third-party origination market last month, slashing its broker network down to 1,000 from nearly 10,000. For its part, HSBC has been bleeding cash as a growing number of its U.S. borrowers find themselves unable to make mortgage payments. The Wall Street Journal ran a telling look inside the company’s efforts to manage some of its credit risk earlier this week, including a look at the bank’s attempt to “re-age” delinquent loans and put them into the performing bucket. (To my eyes, that merely look like using some trickery to massage NPLs lower, reducing the need to set aside reserves, but what do I know?) In a memo to its now-former brokers, HSBC said Tuesday that it would “honor all of our pending lock/loan commitments,” but that active loans must be locked before Dec. 2 and closed before Jan. 20. News of the company’s exit was first reported by the Mortgage Lender Implode-o-Meter, a web site that tracks lender failures. Write to Paul Jackson at [email protected]. Disclosure: The author held no relevant investment positions when this story was published. Indirect holdings may exist via mutual fund investments. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.

More: