The largest US mortgage lender Countrywide Financial Corp. posted an almost 900-billion-dollar quarterly loss Tuesday and wrote down 3 billion dollars for bad loans as the ongoing housing crisis continued to wreak havoc with its business, the dpa reported.
The Calabasas, California-based company said it lost 893 million dollars, or 1.60 dollars a share, in the first quarter, down from a profit of 434 million dollars, or 72 cents a share, a year ago. Revenue at the company also fell sharply to 678.9 million dollars from 2.41 billion dollars a year ago.
Wall Street's average forecasts were for the company to report a profit of 2 cents a share, according to Thomson Financial.
The company showed high delinquency rates in its sub-prime portfolio where defaults on payments rose to 35.88 per cent from 33.64 per cent. The company also said it was forced to set aside 1.5 billion dollars for losses on residential loans, up from just 158 million dollars a year ago, and wrote down another 1.5 billion dollars for other securities and claims.
The poor results could raise questions about Bank of America's plans to merge with Countrywide in an all-stock deal worth some 4 billion dollars. Countrywide has lost more than 2.5 billion dollars in the nine months ended March 31.
The proposal was announced in January and would make Bank of America the nation's leading mortgage lender and loan servicer. The deal was expected to close some time during the third quarter.