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At its peak last year, Providian Corp. had 850 employees in Sacramento devoted to customer relationship management. Today the bank's Sacramento roster has shrunk to a little more than 400, and their task has shifted largely to collections.
That evolution follows a dramatic about-face that San Franciscobased Providian has encountered in the past year. For years, Providian was one of the nation's fastest-growing banks, concentrating on making credit card accounts available to people with either no credit history or blemished credit.
But that was during what turned out to have been the longest economic expansion in the nation's history, and Providian was able to offset losses in its risky portfolio by charging its customers hefty interest rates and fees. When the economy soured all through last year, Providian's customers were the first ones to fall behind in their payments.
Providian earned $38.9 million on assets of $20 billion in 2001, down from earnings of $652 million on assets of $18.1 billion the previous year. Ominously, the bank in the fourth quarter of 2001 posted a loss of $481 million, down from earning $214 million...