DEPEW, N.Y. (WIVB) - A major business move by HSBC means almost 100 jobs will be lost. Workers in the mortgage facility in Depew may be competing for jobs when a new company takes over some of the work.
A thousand HSBC employees poured into the Hearthstone Manor on Monday to hear the news that their employer is transferring the processing and servicing of mortgage operations to PHH Mortgage Corporation out of New Jersey.
400 HSBC employees from the Depew facility will be transferred to PHH Mortgage, which plans to maintain operations in the area. 200 workers will be "displaced," and will compete for the remaining 104 open positions.
Dico Askeraylian, Vice President of Communications at PHH, said, "We're committed to having them coming over to PHH. We're looking forward to them coming over. We're committed to the area. One of the big reasons why we want to do this is the strength out of the employee base of the Depew site."
The jobs will officially be transferred to the new company during the first quarter of 2013. If your mortgage originated with HSBC, you will still be dealing with HSBC branded communication, even though the behind the scenes work will be carried out by PHH.
Financial analyst Richard Schroeder said, "For those who have mortgages though HSBC, they should see very little change. This type of thing happens frequently."
But its impact on HSBC employees will be far more profound, the latest in the bank's cutbacks. In two weeks, First Niagara will take over HSBC branch banks in western New York.
Press release from PHH Corporation:
PHH Mortgage Corporation ("PHH Mortgage"), a subsidiary of PHH Corporation (NYSE: PHH) (the "Company"), today announced it has entered into a strategic relationship to provide private label end-to-end mortgage origination services and loan servicing to HSBC Bank USA, N.A. ("HSBC").
Under the terms of the agreements, PHH Mortgage will provide HSBC with mortgage origination processing services, as well as subservicing of HSBC's $15.5 billion prime mortgage loan portfolio and $36.6 billion of loans serviced for third-party investors (both as of March 31, 2012). It is expected that approximately 400 employees from HSBC's mortgage facility in Depew, New York, will transfer to PHH Mortgage, which plans to maintain operations in the area.
The agreement is effective immediately, and the conversion of operations is expected to be complete in the first quarter of 2013.
"We are excited to partner with a global financial brand like HSBC," said Smriti Popenoe, Interim President of PHH Mortgage, "and we are pleased to welcome many HSBC employees to the PHH Mortgage team. This is an outstanding example of the commitment of our Private Label Services business to serving the nation's leading financial institutions, regional banks, community banks and credit unions, and we look forward to a long-term, strategic relationship."
"We're thrilled and honored to welcome HSBC into our family of private label partnerships," said Glen A. Messina, President and CEO of PHH Corporation, "and we thank them for their confidence in us. We are committed to delivering an exceptional mortgage experience to HSBC customers through our focus on operational excellence and customer service. This partnership demonstrates the strength of our franchise and our commitment to growing our private label mortgage platform."
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