Newsday is reporting that Alt-A lender American Home Mortgage Investment Corp. has cut another 228 employees in its latest round of layoffs:
American Home Mortgage Investment Corp., the beleaguered Melville-based mortgage bank, has laid off another 228 employees, bringing to 428 the number of job cuts this month, a company spokeswoman said yesterday. Speaking about the job reductions, Mary Feder, vice president and director of investor relations, said, “The rationale is that we’re right-sizing our departments in response to market conditions and to keep our departments efficient during challenging times for our industry.” Feder said the the company has made hires in other departments in its Melville office, leading to a net loss of only 27 jobs on Long Island. She said the company now employs 7,627 people nationally. But some believe there will be more job cuts. About ten employees were laid off from the Melville office yesterday morning, two of them said. Several current and former employees numbered the total planned layoffs at 1,200, including the 448 already announced. The company would no [sic] respond to questions about future layoffs.
The article also speculates as to why AHM has not yet announced dates for its second quarter earnings call, noting that many mortgage companies including AHM are having difficulty valuing loans held for investment. I’d agree with some of the analysts interviewed by Newday, who said the layoffs need not be a negative sign — the layoffs may instead be a signal that the company is coming to grips with the fact that the Alt-A market is facing some extended-term difficulties.
