PASADENA, Calif. –Wescom Central CU, struggling with big losses, said today it will eliminate up to 175 positions and close two branches as the result of ongoing losses and a struggling local economy.
The $3.4-billion Wescom reported losses of $21 million in the fourth quarter of 2008 and $52 million for the year.
In an internal memo to Wescom employees obtained by Credit Union Journal, Wescom CEO Darren Williams said the credit union projects the ongoing recession "will continue to have a significant negative impact on our financial performance," and that management expects "higher than normal credit losses" will continue through this year and into 2010.
Wescom is closing its Santiago Hills Branch in Orange County, Calif. and its Chula Vista Branch in San Diego County effective March 6. In 2008 the credit union closed 11 branches; with the new closures it will still operate 42 branches in Southern California.
In the Jan. 21 memo to employees, Williams said the staff reductions were inevitable. "Since more than 50% of our operating expenses are attributable to salary and benefits, it would be impossible to reach this targeted reduction without addressing our staffing levels," Williams said.
The 175 job reductions, which follow elimination of 40 positions in 2008, will be done through layoffs, attrition and by not filling empty positions. In a statement released to Credit Union Journal, Williams said, "Over the past week, we have made extremely difficult decisions that unfortunately have impacted some of our employees. While never easy, these were actions we needed to take to fulfill our responsibilities to our members and support the continued success of our organization."
