UPDATE 1-Connecticut's Webster Fin'l sets mortgage cutbacks

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NEW YORK, Dec 28 (Reuters) - Webster Financial Corp (WBS.N: Quote, Profile, Research), one of the largest banks based in New England, said on Friday it will close its wholesale and correspondent mortgage lending businesses, resulting in a loss of 100 jobs.

The company said the job cuts will allow it to focus on retail banking and on making home loans itself rather than through brokers.

Webster is making the cuts at its Webster Bank unit, and expects to complete them by the end of February, spokesman Arthur House said. The cuts affect about 3 percent of the Waterbury, Connecticut-based company's 3,400 employees, he said. Most of the job losses will be in Connecticut.

Webster cut another 65 jobs earlier this year when it shut offices in Chicago, Phoenix and Seattle, House said.

The company and dozens of rivals have closed or scaled back mortgage operations this year as the U.S. housing market deteriorated.

Webster said it has about $16.8 billion of assets, and operates 179 banking offices in Connecticut, Massachusetts, New York and Rhode Island.

Shares of Webster fell 32 cents, or 1 percent, to close at $32.18 on the New York Stock Exchange on Friday. They have fallen 34 percent this year. (Reporting by Jonathan Stempel; Editing by Braden Reddall, Gary Hill)