Chevy Chase Cuts 300 Jobs, Bank Hours in Housing Lag

Branches Not in Giant Stores to Close on Sundays

Chevy Chase Bank is laying off more than 300 employees as it cuts back its banking hours and adjusts to lower mortgage demand brought on by the housing market slowdown, bank officials said.

More than 200 of the layoffs come from a change in banking hours. Chevy Chase, based in Bethesda, ramped up its evening banking hours and added Saturday and Sunday hours over the past two years as it sought to draw more customers and compete against other banks in the region, such as Bank of America, SunTrust and Wachovia.

Around 100 layoffs will occur in its mortgage operations. Chevy Chase underwrites billions of dollars in home loans throughout the country, including many in California. The company operates under two names: B.F. Saul Mortgage Company and Chevy Chase Bank.

Like many other financial institutions, Chevy Chase staffed up its mortgage department in recent years as home sales, home prices and refinancings took off. The company hired dozens of sales officers who handled the underwriting of loans to outside mortgage brokers.

As the housing market has plunged and demand for mortgages has dipped, sales officers and account executives across the country, including in Texas and Florida, have been let go.

"It's a bit of a cyclical business," said Chevy Chase executive vice president Thomas H. McCormick. "It's simply a reflection that there are fewer mortgages being produced because of the housing market's condition."

Chevy Chase, which is privately held, operates 287 branches and employs 5,000 people, the vast majority in the Washington area. Its branches include 233 in traditional retail settings and 54 inside Giant Food stores.

Starting in 2005, the majority of the branches extended their hours to run from 9 a.m. to 7 p.m., Monday through Friday; 9 to 4 on Saturday; and, in some cases, 11 a.m. to 4 p.m. on Sunday. The branches will now close at 5 p.m. Monday through Thursday, but remain open until 7 p.m. on Friday. The new Saturday hours are 9 a.m. to 1 p.m.

The branches in Giant grocery stores will continue to be open between 11 a.m. and 3 p.m. Sundays, but the traditional branches will be closed.

"It was not as much of a payback as we thought," said Scott McSween, executive vice president for retail banking. "The extended hours were not giving us the return on investment that we had hoped for. We still have extended hours; we just rolled them back a bit."

Chevy Chase said it would shift some of its resources toward initiatives to attract Latino customers.

"Nobody went to the bank on certain nights, but we found that customers did care that documents are in Spanish as well as English," McSween said.

The bank also plans to expand its small-business customer base, improve its online banking and upgrade its automated tellers in January so customers no longer have to use envelopes to make deposits.

Chevy Chase, owned by B.F. Saul II, will continue to open branches throughout the region and plans to have more employees a year from now, McSween said. The company said it has hired about 1,000 workers in the past two years. He said the company is already hiring back some of the laid-off employees to do different tasks.

The company is headquartered on Wisconsin Avenue in downtown Bethesda and has large operations in Laurel and a small processing center in Tysons Corner.