The Wall Street Journal reported this morning that Residential Capital LLC, the home-lending arm of GMAC Financial Services, will cut 25 percent of its workforce -- 3,000 employees -- as the troubled lender looks to adjust to an extended downturn in the US mortgage market. From the Journal's coverage:
"ResCap has taken aggressive actions to date and will continue to adjust its operations to be more in line with the dramatically changed real-estate finance environment," spokesman Stephen DuPont wrote in a release. "We are focused on turning around the business and believe ResCap will continue to be a market leader in the mortgage space for the long term." He declined to comment further.
Subscribers can read the full story. ResCap's long term issuer default rating was dropped to "junk" status in August by Fitch, and today Standard & Poor's warned it may do the same.