Citi Residential Lending - Retail, Wholesale, Subprime, Alt-A
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stories: freedomblogging.com, businesswire.com, nytimes.com
Update - 2009-02-02: The memo said "the latter part of 1Q 2009," and that time it seems is apparently here. We were tipped off that the Citi Residential office in Rancho Cucamonga, CA would be closed on March 1st, 2009. A source we spoke with indicated between 500 and 600 employees at that location would be affected, including the servicing unit. Another source reported Citi Residential's portfolio is being split, with roughly half going to CitiMortgage and the remainder being sold off to American Home Mortgage Servicing and other banks.
We are working to gather info on the fates of the other offices in Schaumburg, IL and Orange, CA.
Update - 2008-05-07: In a 2008-05-06 memo to CitiMortgage and Citi Residential Lending (CRL) employees, it is announced that CRL's retail staff and sites will not be part of the integration into CitiMortgage. A tipster emailed us this:
"Citi Residential Lending is being consolodated and moved to citi central offices in AZ and TX, and all positions in Rancho Cucamona California, Shaumburg, IL and Orange, CA will be eliminated by the first quarter of next year. People will be notified of their exact layoff date over the next 2 weeks. A meeting was held at each site at the same time today advising that all sites (previous Ameriquest offices) will be closed down."
This is confirmed in the memo, which states: "We will work toward completing this integration in a phased approached concluding the latter part of 1Q 2009 at which time all CRL sites will be closed."
Layoffs will affect about 3,000 CRL employees according to one source. These are "fresh," in addition to layoffs previously reported for CRL's wholesale, according to our source. They are "basicly shutting down all CRL operations and migrating everything over to Citi Mortgage." From the memo:
"We will work very closely with those whose positions are affected by this decision. A top priority is to provide all our people with comprehensive support throughout this process, including outplacement services and separation pay benefits, where applicable."
View the entire memo here.
Original Listing - 2008-04-25: In a memo sent out to brokers on 2008-04-23, Citi Residential announced its last days:
Original Ailing Listing - 2008-03-18:In a 9:30am conference call this morning, layoffs were announced for Citi Residential Lending headquartered in Orange, CA. According to one AE we spoke with, only 50 reps will remain out of some 500, and the office will be closed by June of this year. A second conference call scheduled for 3pm today will probably let those remaining know what lies ahead as the unit is absorbed into CitiMortgage. A call to Citi Residential's media relations department was not immediately returned.
The move is part of a major consolidation of Citigroup's various lending units including CitiMortgage, Citi Home Equity and Citi Residential Lending under the CitiMortgage name, a restructuring plan officially announced 2008-03-07.
Citi Residential is the remnant of ACC Capitol Holdings (including wholesale subsidiary Argent) acquired by the investment bank in February of 2007. In a 2008-01-08 NY Times article, the purchase was likened to "catching a falling knife", but the reorganization is seen "as a natural outgrowth of the deal." From an excerpt:
"It is not going to be a subprime shop," said Jeffrey A. Perlowitz, the head of the global securitized markets division of Citigroup's investment bank at time time. "It is going to be a nonconforming shop and we are going to originate along the continuum, from jumbo loans to Alt-A to subprime."
Citing a memo sent to Citi employees, the article reports the appointment of Bill Beckmann to oversee "the creation of an end-to-end U.S. residential mortgage business that includes origination, servicing and capital markets securitization execution."
"In this role, Bill will work closely with Jeff Perlowitz, the CMB head of Global Securitized Markets (GSM), to determine how to best integrate Citi Residential Lending's origination and servicing functions and those in CitiMortgage."
News will continue to come in, and we will provide updates as more accurate information becomes available. Contact us if you can provide more details.
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Important: This company is on our list of lending operations that have "imploded". However, please note that "imploded" is a somewhat subjective and does not necessarily mean operations are ceased permanently: it can mean bankruptcy filing, temporary but open-ended halting of major operations, or "firesale" acquisition. All information here is provisional, and may contain inaccuracies (especially newer information). If you are planning on doing business with this company or any other one listed on this site, you should inquire with them directly on whether they can still meet your needs. Many are still operating in some capacity.