SpringLeaf Finance Corp., which is partly controlled by the U.S. government, has entered into another round of layoffs, and may have to file for bankruptcy protection, according to industry advisors close to the company.

In a recent SEC filing, the Evansville, Ind.-based nonprime residential servicer raised the bankruptcy issue, saying if its financial condition does not improve, “we may not be able to generate sufficient cash to service our debt.”

SpringLeaf posted a $48 million operating loss in the first quarter after losing almost $100 million the past two years.

At deadline the company could not be reached for comment.

In March SpringLeaf Finance closed 150 branch offices in 25 states, resulting in 360 layoffs. Since then another couple of hundred workers have been let go, according to two sources that have done business with the company. Roughly 600 people have been left go this year.

The firm—formerly known as American General Finance—is owned by Fortress Investments and American International Group. AIG is owned, in part, by the U.S. Treasury.

Last year the Treasury and Fortress had hoped to spin-off SpringLeaf by selling $500 million worth of stock to the public—through a REIT structure, but the deal has gone nowhere.

SpringLeaf owns about $9.6 billion of residential real estate loans and $2.5 billion of consumer finance loans. Over the years it has mostly declined to talk to the media.

A unit of Fortress Investments manages the company and one of SpringLeaf’s servicing partners is Nationstar, which recently went public.

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