Sept. 22--Job cuts are coming within BB&T Corp.'s mortgage division, but where and how many may not be known until well into 2014.
Daryl Bible, the bank's chief financial officer, said during an analyst presentation last week that the division is experiencing the same pressures from higher mortgage rates and lower refinancing demand as its peers.
In the past month, Wells Fargo & Co. has cut at least 461 mortgage-division jobs in North Carolina (mostly in Charlotte and Raleigh) as part of eliminating at least 4,188 jobs companywide. Bank of America Corp. has cut more than 2,000 jobs companywide in its mortgage business.
By comparison, BB&T has about 3,200 employees overall in the Triad.
Bible acknowledged the mortgage job cuts by its competitors and peers. He said it will be the first half of 2014 "before we start to right size the business."
Bible said that BB&T's mortgage business has flipped in recent quarters, going from refinancing making up about 67 percent of its mortgage activity to about 30 percent now. He said that total mortgage volume is set to fall between 10 percent and 15 percent in the third quarter, and applications are down 30 percent.
All of which, Bible said, makes mortgages "the big wild card" and "the headwind" in terms of revenue for at least the next two quarters.
But first, he said, the bank will complete a major change in how it handles mortgages.
The bank currently makes some first and second mortgage originations in branches in what Bible called "direct retail channels." It also has a separate mortgage business unit.
However, to make it easier to comply with new regulations from the federal Consumer Financial Protection Bureau, BB&T is moving all originations into its mortgage banking unit.
Bible said the mortgage unit currently produces $32 billion in mortgages annually, while the branches combined produce about $9 billion.
"We have to get that business and that volume into the mortgage channel," Bible said. He said the bank plans to move origination production from at least 200 branches a month into the mortgage channel.
"We are going to get through this transition first and probably be a quarter or two behind some of our peers so we can get the transition fully done and integrated. We can't drop the ball, can't lose any client business."
BB&T spokesman David White said Thursday the bank "evaluates operations throughout its system on an ongoing basis to ensure efficiencies."
When asked how the mortgage origination transition away from branches and toward the mortgage unit could affect jobs, White said "it would be premature for us to speculate on the specifics of any potential job reductions."
Kelly King, the bank's chairman and chief executive, said in April that BB&T had launched a corporate restructuring aimed at lowering expenses. He said at that time the bank was "ahead of the curve" in adjustments involving full-time employment, including job cuts made during the first quarter.
Unlike some of its peers, King has said BB&T will not announce a large-scale expense initiative.
BB&T reported having 33,869 full-time employees in the King presentation, slightly fewer than the 34,000 that financial-services research companies had listed.
White repeated Thursday that the expense initiative does not affect its plans for its Triad Corporate Center in Greensboro.
The bank said in October 2012 it would create 1,700 new jobs over five years as part of opening a large back-office operation near Piedmont Triad International Airport. The center is projected to eventually hold up to 2,500 employees.
"We expect to locate about 250 jobs there as part of our mortgage operations business," White said. "We anticipate having the majority of these positions filled and in place by fourth quarter."