NORTH BAY -- Wells Fargo & Company announced the restructuring of the Wells Fargo Financial division, which will close 638 Wells Fargo Financial stores in the U.S. including an office in Santa Rosa and Fairfield.
The company expects to see 2,800 positions eliminated in the next two months and another 1,000 in the next year.
There are currently 14,000 positions at Wells Fargo Financial, and the remaining people will be moved to other Wells Fargo businesses.
“Our network of U.S.-based consumer finance stores, which have historically operated as an independent sales channel from our bank operations, have served customers well for more than 100 years,” said David Kvamme, president of Wells Fargo Financial. “But the economics of a separate Wells Fargo Financial channel are no longer viable, especially now that our customers have access to the largest banking and mortgage store network in the United States.”
With the plan, Wells Fargo is leaving the non-prime portfolio mortgage loans origination business.
The rest of the services offered from Wells Fargo Financial will be available through the expanded network of community banking and home mortgage offices.
“Customers with existing Wells Fargo Financial consumer loans and clients of Wells Fargo Financial’s commercial businesses will continue to be served without disruption,” the company said in a release.
“FHA home loans, auto loans and credit cards previously offered by Wells Fargo Financial will be consolidated with similar products across the company and will be offered through the company’s network of community banking stores, mortgage stores, phone banks and wellsfargo.com. Wells Fargo Financial’s commercial businesses will be realigned with business units within Wells Fargo over the next 12 months. However, Wells Fargo will no longer originate non-prime portfolio real estate loans.”
“We know that this decision will be extremely difficult for those dedicated team members and their families who will be affected,” said Mr. Kvamme. “We have already identified positions for thousands of our employees and are committed to finding new positions for as many impacted team members as possible.”