Countrywide Financial Corporation, the largest US mortgage lender, said Friday it had lost more than 1 billion dollars in the third quarter hurt by the weaker housing market and rising defaults on subprime mortgages, according to dpa. Countrywide lost 1.2 billion dollars, or 2.85 dollars per share, in the quarter. In the year-earlier period the Calabasas, California- based lender had earned 648 million dollars, or 1.03 dollars per share. The quarterly losses were the firm's first in 25 years and come amid a housing market crisis prompted by so-called subprime mortgages to borrowers with poor credit that have led a record number of homeowners to lose their houses. Losses for the year through September were 281.6 million dollars, or 1.24 dollars per share, compared to profits of 2 billion dollars, or 3.29 dollars per share, in the same period of 2006. The firm hopes to return to profitability in the fourth quarter and next year after introducing cost-saving measures. Chief executive Angelo Mozilo said the firm had focused on stabilizing its liquidity, strengthening its capital position, tightening its loan programme and underwriting guidelines, and beginning "the process of right-sizing operations for today's lower volume mortgage market." "Countrywide's results for the third quarter of 2007 reflect the impact of unprecedented disruptions in the US mortgage market and the global capital markets, as well as continued weakening in the housing market," Mozilo said in a statement. Countrywide said Tuesday it will offer 82,000 borrowers with adjustable loans that put them at risk of losing their home new financing options. It will refinance or change terms on 16 billion dollars of loans that are set to readjust to higher interest rates through next year. Loan firms and banks have suffered declining profits in the midst of the loan crisis and have been criticized for offering loans to customers with poor credit histories who may not have understand their terms.
