(The following item was transmitted on Friday, Oct. 12, and is repeated for additional subscribers)
By Al Yoon
NEW YORK, Oct 12 (Reuters) - Autumn in New England may feel more like a winter of discontent for the 4,000 home lending specialists heading to Boston next week for an industry jamboree set amid the worst housing slump in a generation.
The Mortgage Bankers Association’s annual convention, a gathering ordinarily known for its pomp, parties and star sightings, this year will reflect the belt-tightening across a business under siege.
The biggest lenders, Countrywide Financial Corp CFC.N and Washington Mutual Inc (WM.N), have slashed registrations by more than a third, and the MBA expects overall attendance to drop by 25 percent from last year, according to its president, Jonathan Kempner.
The expected attendance might have been worse without top-draw speakers, including Bono and Richard Branson, said Kempner.
Despite massive layoffs at Countrywide this fall, it is sponsoring the U2 frontman, known for his philanthropy work for the poor in Africa. He will share a time slot with U.S. Housing and Urban Development Secretary Alphonso Jackson, whose agency is trying to soften the impact of risky lending practices on low-income Americans.
“It’s like we’re throwing a big party, and this year there has been a lot of bad weather and some people just won’t be able to make it,” said Kempner. “We knew we had to work harder to attract people.”
As of Thursday the MBA had registered just 38 Countrywide employees for the Oct. 14-17 meeting, down from 61 last year and 63 at the height of the housing boom in 2005.
Wells Fargo & Co(WFC.N) , JPMorgan Chase & Co’s Chase Home Mortgage and WaMu also sharply trimmed registrants.
Many previous conference-goers are now out of work, with 97,509 housing-related jobs slashed in the past year, according to Challenger, Gray & Christmas Inc.
The bottom line: Mortgage bankers lost $50 per loan in 2006, compared with $258 profit in 2005, according to the MBA.
The potential for even more housing market mayhem in the coming months will be a key topic at the meeting, as will the $650 billion in adjustable-rate mortgages whose payments are slated to rise through 2008, analysts say. Rising delinquencies on ARMs made under loose lending standards have added to a vicious cycle of foreclosures, rising inventories and falling home prices.
Seismic shifts of power in the industry are still unfolding, with some lenders still nursing their wounds and others moving forward. Large, diversified lenders that can operate without the help of chilly credit markets are investing for a rebound, even if forecasters do not see one until mid- to late-2008.
“We’re at the beginning of an 18-month period that’s going to be very bumpy,” said Alfred DelliBovi, president of the Federal Home Loan Bank of New York and a former HUD official.
Larry Goldstone, co-founder of jumbo lender Thornburg Mortgage, added: “There seems to be a lot of uncertainty about exactly what people want to do” in the near-term.
Whatever businesses survive, they are keen on sharing information that will nurse the industry back to health, according to Kempner. But he concedes that the mood at the conference “candidly, will be very mixed.”