NEW YORK (Reuters) - Countrywide Financial Corp CFC.N, the No. 1 U.S. mortgage lender, said on Thursday mortgage loan funding tumbled 40 percent to $23 billion in November, sending its shares down 5 percent as late payments continue to escalate.
The bulk of the origination decline came from a near-evaporation of Countrywide’s subprime lending business and a sharp fall-off in adjustable-rate mortgages. As a result, Countrywide’s loan origination staff has been cut by nearly 2,300 employees since the end of October to 23,424. That’s down more than 10,000 from peak levels in July.
In November 2006, Countrywide’s total mortgage funding was $38.3 billion.
Credit Suisse analyst Moshe Orenbuch said Countrywide’s delinquency rate was 6.34 percent in November, up from 5.89 percent in October.
Subprime mortgage funding fell to $17 million in November from $3.06 billion a year earlier, when lending standards were lax. Adjustable-rate fundings fell to $3.33 billion from $14.3 billion.
Countrywide has been battered by escalating loan defaults, a crisis that has reverberated around the globe and forced the White House to fashion a bailout plan for cash-strapped borrowers undone by falling housing prices and loan payments reset at higher interest rates.
Countrywide shares fell 51 cents to $10.02 in afternoon trade on the New York Stock Exchange.
The lender said average daily loan application activity was $1.9 billion in November, a 32 percent drop from a year earlier.
The company’s mortgage loan pipeline, or loans in process, was $42.6 billion at November 30, down from $62 billion a year earlier.
Reporting by Tim McLaughlin, editing by Lisa Von Ahn/Jeffrey Benkoe