Mortgage lender cuts processing unit

Bradford and Bingley is closing a mortgage processing centre to cut costs as sales volumes plummet as a result of the credit crunch.

About 300 call...

Bradford and Bingley is closing a mortgage processing centre to cut costs as sales volumes plummet as a result of the credit crunch.

About 300 call centre staff will go at the processing unit in Hertfordshire and the work will be transferred to a centre at Bingley in West Yorkshire.

The company, which specialises in buy to let mortgages, has struggled since the onset of the credit crisis and lost £26.7m in the first half of the year.

Processing units, which house IT infrastructures, are prime targets for cost cutting as business volumes fall.

In July, Barclays announced job cuts at its FirstPlus loans business when it decided to no longer offer new loans.

Peter Redshaw, analyst at Gartner, said the last couple of weeks, where various banks have been involved in major consolidation, has accelerated cost cutting activity in the finance sector.

"This was already happening but the last few weeks have accelerated it," he added. He said banks are moving from a focus on efficiency to one where they are looking to purely cut costs.

"Processing units can be reduced because certain business lines are not doing as much business," he added.

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