Wells Fargo, parent of Wachovia Bank, said Thursday it will close its consumer finance division, a move that will shut down 18 stores in Georgia.
Wells Fargo Financial, a century-old division of the San Francisco-based conglomerate, offers subprime mortgages, consumer credit cards and auto loans. Wells Fargo Financial has 10 stores in metro Atlanta, all of which will be closed.
The changes will eliminate 3,800 jobs and 638 Wells Fargo Financial locations nationwide over the next 12 months. No Wachovia or Wells Fargo bank branches will close.
It is not clear how many Georgia jobs will be affected. In a news release, Wells Fargo said it is working to find positions within the company for affected employees. A spokesman said decisions about job cuts would be made on a "market by market basis."
Wells Fargo also announced it is ending its subprime home loan business, which accounted for 2 percent of its real estate loan portfolio. Services previously offered through Wells Fargo Financial stores will be provided through Wachovia branches and Wells Fargo Mortgage offices.
Servicing of existing home and auto loans, as well as credit cards, will not be affected, Wells Fargo said.
The company’s 2008 acquisition of Wachovia was a contributing factor in this latest consolidation, making the consumer finance division redundant with the products and services offered through the merged company's 6,600 branches and 2,200 mortgage offices, Wells Fargo said in the release.
David Kvamme, president of Wells Fargo Financial, said in a statement that “the economics of a separate Wells Fargo Financial channel are no longer viable,” given the national reach of its branches and home loan offices.
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