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Bear Stearns Consolidating Mortgage Operations

Bear Stearns announced via a press release today that it is creating a single mortgage unit under the name “Bear Stearns Residential Mortgage Corporation”, combining operations at Bear Stearns Residential Mortgage and Encore Credit.

As part of the consolidation, 310 jobs will be lost in its mortgage origination businesses, marking a 40% reduction in its mortgage loan origination workforce since the start of 2007.

“We have a powerful mortgage franchise and this combination will allow our account executives better access to the full suite of products Bear Res can now offer,” said Tom Marano, Global Head of Mortgages, Rates and Foreign Exchange.

“A hallmark of our franchise has been our ability to adapt to changes in the market environment and product demand, he added.”

The new consolidated mortgage unit will be headed by Jeff Walton, the current head of Bear Res who will be named CEO, and former head of Encore Credit, Shabi Asghar, who will be named President.

According to the release, the newly created lender plans to offer a bevy of agency-backed, government loans.

“Looking ahead, we will soon be expanding our product menu to include Fannie Mae, Freddie Mac and FHA loans,” said Marano.

“These additions will increase our capabilities and further allow our brokers to select the products that best meet their customers’ needs.”

The question remains whether Bear will be able to separate itself from the crowd by offering agency product that nearly every other bank and mortgage lender has access to.

See the latest mortgage layoffs, lender closures, and mergers.

Update: Bear Stearns’ Marano said the Fed needs to drop interest rates a further 100 basis points, which he believes will happen over next three quarters.

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