NEW YORK (Reuters) - Countrywide Financial Corp CFC.N Chief Executive Angelo Mozilo sold some of his shares in the No. 1 U.S. mortgage lender to handle matters relating to his estate and retirement, former Countrywide board member Henry Cisneros said on Fox Business Network on Wednesday.
Mozilo said in October that the U.S. Securities and Exchange Commission had opened an informal inquiry into his stock sales. He and the company are cooperating with the inquiry.
“Basically what he was doing was handling his estate from years before when he hadn’t sold... as he begins to approach retirement, so those are completely separate matters, no matter how people may try to conjoin them,” Cisneros said.
Cisneros, a former U.S. Secretary of Housing and Urban Development, resigned from Countrywide’s board of directors in October, saying he was leaving to spend more time as chairman of CityView, which provides financing to U.S. homebuilders.
Mozilo has realized more than $100 million of gains in the last year since he began selling shares on a regular basis last October, just as the U.S. housing market was cresting. He later accelerated the pace of those sales twice.
Mozilo has said that “at no time” did he made any trading decisions based on material, nonpublic information, and that he “fully complied” with all Countrywide policies and applicable securities laws.
Speaking of Countrywide’s future, Cisneros said, “I think Countrywide is going to be fine when all is said and done.”
Addressing some of the controversy surrounding Countrywide’s lending practices during the housing boom, Cisneros said: “Like many other companies, I think Countrywide ventured into products for competitive reasons, (it) just marched down that road toward things that in calmer times people shouldn’t have undertaken.”
He added that since it appeared the housing boom would “last forever,” it was important to garner market share and that a lot of mortgage lenders were taking similar actions.
“I think what will be clear when a post mortem is done on this period is that products were put out there, in the industry in general, which in retrospect went too far,” he said.
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