The Company I work for has faced some major challenges in recent years; the acquisition of Countrywide ended up being one of the worst business decisions any major Bank made in the Subprime crisis. Bank of America has had to pay (by my very rough estimate from media reports) over $30 Billion to settle Representation and Warrant claims with the GSE Investors, the private label securities and the MI companies. Back when Countrywide collapsed I thought Bank of America got a steal by being able to purchase Countrywide's $2 Trillion servicing portfolio, a $15 Billion Corespondent Lending Division, Countrywide's industry leading origination platform and the entire mortgage banking brain trust that had the industry for so long.
When the crisis hit and Countrywide's losses ended up being much larger than Bank of America had ever anticipated, I believe, Bank of America began to sour on the former Countrywide entity. Most of my division's executive management can see Bank of America's intentions to wind down the Correspondent Lending arm of the mortgage business. In the last 3 months Correspondent Lending has lost 5 of the 6 top executives to Penny Mac (a tiny rival start-up mortgage banker, google it if you don't know the company), worse yet Correspondent went from $15 Billion in loan purchases a month to $10 Billion in the last 6 months (the rumor mill is circulating that Corporate wants to reduce Correspondent to $3 Billion in a year's time). It's shocking for a company the size of Bank of America to lose all it's top talent to a tiny start up, it makes the people in the trenches (like me) worried about the direction of our division. Personally, I've lost faith in our management team to continue to build the Corespondent Division, in fact people are worried for their jobs.
As I told my co worker, rats are the first to leave a sinking ship, maybe we should take the hint from our executive management team and jump ship too.
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