NEW YORK (Reuters) –

Wachovia Corp (WB.N), the

fourth-largest U.S. bank, will stop making mortgage loans

through its branch offices in 19 U.S. states, a published

report said.

The bank will eliminate 125 jobs in connection with the

cutback, but still plans to offer mortgages through branches in

18 other states, Bloomberg News reported on Friday.

Wachovia did not immediately return calls seeking comment.

The latest cuts extend the fallout from the Charlotte,

North Carolina-based bank’s failed $24.2 billion purchase in

2006 of California mortgage lender Golden West Financial Corp.

A surge in mortgage losses contributed to an overall $8.86

billion second-quarter loss at Wachovia. They were also a key

reason the bank in June ousted Ken Thompson as chief executive.

Robert Steel, a top U.S. Treasury Department official, was

named in July to replace Thompson.

Wachovia is eliminating more than 10,700 jobs and plans to

reduce expenses by $2 billion by the end of 2009. In July, it

said it had already eliminated 2,000 retail mortgage jobs this

year, and planned to cut 4,400 more over 12 months.

Shares of Wachovia closed Friday up 81 cents at $17.93 on

the New York Stock Exchange. They have fallen 53 percent this

year.

(Reporting by Jonathan Stempel, editing by Leslie Gevirtz)