CHARLOTTE, N.C. — In addition to scaling back its investment banking operations, Bank of America Corp. is exiting the wholesale mortgage business and eliminating about 700 jobs, bank officials said yesterday.

The nation’s second-largest bank will stop offering home mortgages through brokers at the end of the year to focus on direct-to-consumer lending through its banking centers and loan officers. The move also eliminates the jobs in the bank’s consumer real estate unit.

The public announcement of the decision is scheduled for today.

The cuts are part of the 3,000-job reduction engineered by chief executive officer Ken Lewis and announced Wednesday after the nation’s second-largest bank reported a huge decline in third-quarter earnings.

Bank of America employees in several consumer real estate locations — including Dallas, Richmond, Va., and Brea and Rancho Cordova, Calif. — will have the opportunity to apply for open positions within the company, bank spokesman Terry Francisco said.

The bank started informing affected employees yesterday. Bank of America’s consumer real estate division employs about 13,000 people and it works with about 7,000 independent brokers.

“While we are extremely proud of our strong track record in the wholesale business, we believe our long-term opportunity lies in maximizing our more competitive retail channels,” said Floyd Robinson, Bank of America’s president of consumer real estate and insurance services in a statement.

A manifestation of that retail strategy, especially during a downturn in the U.S. mortgage market, has been the development and successful execution of its national “no-fee” mortgage program.

The nation’s financial institutions have been squeezed as a credit-crunch and defaults in subprime loans have caused investors to become hesitant about taking risks. Dozens of home lenders halted operations this year and are being slammed as housing prices continue to slide. An increase in defaults has forced banks to tighten lending standards.

Bank of America’s product, which was introduced in May, does away with the collection of borrower, lender and third-party fees that typically add a few thousand dollars to the price of buying a house. That product has produced more than $50 billion in application volume in the past six months, according to the bank.

Such a product, Robinson said, has enabled Bank of America to “gain critical market share.”

In the third quarter, Bank of America’s overall first mortgage-financed production increased 27 percent when compared with the same period last year. Driving that overall increase was a 60-percent spike in financed mortgage originations through banking centers and a 26-percent increase in financed originations by mortgage loan officers, the company said.

“Ken says he likes the retail business, he likes getting to know customers, underwriting and managing his risk,” said Tony Plath, an associate professor of finance at the University of North Carolina at Charlotte. “He just doesn’t like the securitization and servicing sides of the business.”

He may not like it, but he is willing to form an alliance and help it, Plath said.

In August, Bank of America invested $2 billion in Countrywide Financial Corp. — the biggest U.S. home lender — when the Calabasas, Calif.-based company was running short of cash.

Countrywide is among the dozens of mortgage lenders that have battled a spike in mortgage defaults and foreclosures, especially in subprime loans — those made to borrowers with weak credit.

Those specific problems haven’t extended to Bank of America, which exited the subprime lending market in 2001 when Lewis took over as CEO. The bank called it a business that had “become unattractive from a risk-reward standpoint.”

In recent months, Lewis has pushed his bank to improve its market share of prime mortgages, or those offered to borrowers with a solid credit history, and industry experts say it’s a market the bank has yet to fully tap.

As of Sept. 30, Bank of America held a residential mortgage portfolio of $274 billion and has a stated aim of doubling its current 5-percent share of the direct-to-consumer mortgages in the next three years.

“We see a lot of opportunities in growing our retail business,” Francisco said. “By exiting wholesale mortgage we are putting our full focus in one area, not splitting it.”

Bank of America shares fell 48 cents, or 1 percent, to $47 in trading Thursday.