Cutbacks Crack E*Trade

E*Trade Financial(ETFC Quote) slumped 10% late Monday after the online broker slashed its earnings guidance and became the latest company to drop out of the wholesale mortgage business.

E*Trade said in a release after the market closed that it was exiting or restructuring "noncore businesses that lack a direct or strategic connection with its retail customers."

Among other things, the company is boosting its provision for loan losses "due to charge offs expected as a result of the disturbance in the credit markets." E*Trade expects mortgage loan charge-offs of $95 million and a bad loan provision of $245 million. ...