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| Shares of publicly-traded subprime mortgage lenders took a beating Thursday.
The decline was prompted by warnings from New Century Financial Corp., which announced it would restate financials for the first three quarters of 2006 to increase its allowance for loan repurchase losses, and HSBC Holdings plc, which said it would set aside 20% more than analysts had expected for loan impairment charges and other credit risks because of nonprime trends. New Century shares led the decline, tumbling 36% for the day to $19.24. Shares of NovaStar Financial Inc. declined 11% to $18.31, while Accredited Home Lenders Holding Co. shares fell 6% to $27.25. Less battered were shares of Alt-A giant IndyMac Bancorp Inc., which were off less than 3% to $37.47. Countrywide Financial Corp., which reported $88.5 billion in nonprime production last year, saw its stock decline more than 2%, while the decline in shares of Fannie Mae and Freddie Mac was less than 2%. |
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Sam Garcia worked in mortgage lending for twenty years prior to becoming publisher of MortgageDaily.com. e-mail:Â mtgsam@aol.com |
