Bank of America, a major employer in Richmond, laid off approximately 40 local workers last week at its massive mortgage operations center on Villa Park Drive in Northern Henrico.
The company confirmed the cuts Wednesday, explaining in a prepared statement that they are a result of changes in the mortgage market as more troubled loans are resolved and interest rates rise.
“We continue to reduce the size of our mortgage servicing operations in line with the successful reduction of our portfolio of delinquent mortgage customers,” the company said in its statement. “Compared to peak levels in 2011, today we have fewer than one-third the numbers of customers who need the specialized programs and support of this team.
“These actions also reflect our ongoing efforts to streamline our facilities and align our cost structure with market realities, including declining refinance volume resulting from rising interest rates.”
Bank of America is the third large financial firm to trim its staff in Richmond in recent months.
Capital One said in June it was eliminating more than a dozen employees from its branding department at its West Creek campus.
That same month Genworth Financial said it was cutting between 75 and 100 local employees as part of a companywide layoff of 400 positions.
Bank of America’s Villa Park facility handles mortgages at various stages of the loan process.
It keeps a tight grip on its operations at the complex. Entry is guarded around the entire perimeter and the company has shied away in the past from giving an exact employee headcount of the facility. It sits on 46 acres on Villa Park Drive and consists of several buildings, including an 8-story high-rise.
In late 2009, Bank of America announced it would invest $150 million to expand the facility.
The company employs approximately 2,000 workers locally, according to a tally earlier this year by the Richmond Times-Dispatch. It had 31 bank branches in the Richmond market, according to the most recent data from the FDIC.
Other markets have been hit harder by layoffs at the company. Late last month, it announced the closing of two facilities in the Cleveland area, resulting in layoffs of more than 1,000 employees.
Reports on Wednesday said Bank of America was cutting 152 mortgage jobs in Sunrise, Fla.
Two years ago, the company announced plans to cut 30,000 jobs in an attempt to eliminate $5 billion in expenses. Those cuts were to be made over a period of a few years.
Other financial giants have announced layoffs in recent weeks including Fifth Third Bank, JP Morgan Chase and Wells Fargo.
Bank of America, which has $2.1 trillion in total assets, did not specify what sort of severance or outplacement services might be provided to the effected employees. It reiterated a “strong track record for helping our employees identify opportunities both inside and outside of the bank and we are working closely with leaders in the community to support a smooth transition.”
“We remain committed to Virginia and continue to refine our business model to account for changes in the marketplace to both preserve our presence and plan for the future,” it said in its statement.