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What’s in Your Wallet? Not GreenPoint Mortgage now that Capital One jettisons the ailing mortgage company. Today GreenPoint is worth nothing, but when Capital One purchased the company a year ago for 13.2 Billion dollars the company was a high flyer.

GreenPoint is the newest casualty of the credit crunch as their business was built on Alt-A loans. Last year the company originated 18 billion in Alt-A loans but since the wholesale market has dried up there is no way for the company to remain in business.

Now 1,900 employees will be out of work. These are tough times in the mortgage world.

Capital One Financial Corp. shut its GreenPoint Mortgage unit, eliminating 1,900 jobs, and lowered its earnings forecast as the worst U.S. housing slump in 16 years erodes demand for home loans.
Capital One bought GreenPoint less than a year ago in a $13.2 billion deal that was the biggest acquisition to date for Chief Executive Officer Richard Fairbank. Today, the McLean, Virginia-based bank cut its 2007 earnings forecast to $5 a share from $7.15, triggering charges of about $860 million, or $2.15 per share, mostly during this year.
“They said, ‘Let’s just cut our losses now and get out,”’ said Thomas Brown, chief executive officer at Second Curve Capital LLC in New York, which owned 1 million shares of Capital One on June 30. “The company had been getting a lot of questions about that business.” Bloomberg.com

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