WaMu has been hit by the downturn in demand for mortgages
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Washington Mutual (WaMu), one of the largest US mortgage lenders, is laying off 3,150 staff because of its problems in the mortgage and credit markets.
WaMu doubled the amount it is setting aside to cover loan losses in the last three months of the year to between $1.5bn and $1.6bn (£733m and £782m).
The bank is cutting its three-month dividend to 15 cents per share from 56 cents in the previous quarter.
Washington Mutual is also stopping all of its sub-prime lending.
It also said it would close other parts of its business such as its home loan centres.
It blamed the problems on a sharp downturn in demand for mortgages.
The job cuts will be made up of 2,600 mortgage staff and 550 corporate support jobs, which represent 11% of its total workforce.
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