Morgan Stanley slashes US residential business...
Lehman Brothers has cut another 200 staff from its UK mortgage businesses. It has closed Southern Pacific Mortgages and Preferred Mortgages and in future will operate under the name Lehman Mortgage Capital. These redundancies follow other staff cutbacks. In November, Lehman let go 177 UK-based mortgage staff and 1,700 in its US business in January. It has also closed its London Mortgage Company business. The bank blames the continuing dislocation in the global markets for its actions.
Before the credit crunch, Lehman Brothers had been aggressively growing its UK sub-prime mortgage businesses. It acquired Southern Pacific Mortgages in September 2002 and added Preferred Mortgages at the end of 2003. At the time, US investment banks were buying up UK sub-prime or non-conforming mortgage providers.
Bear Stearns bought Rooftop Mortgages in 2004. Merrill Lynch picked up Mortgages Plc in the same year.