As rumors of an impending bankruptcy continued to hammer the company’s stock, Countrywide Financial Corp. published statistics on December loan production a few days earlier than expected.

The report — which showed better-than-forecast loan fundings of $23.5 billion but a continuing rise in delinquencies and foreclosures in Countrywide’s $1.5 trillion servicing portfolio — failed to calm investors, with the lender’s stock falling nearly 15 percent in early afternoon trading Wednesday.

That follows a nearly 30 percent drop in Countrywide shares on Tuesday, after the company was forced to issue a statement denying rumors that it would declare bankruptcy (see Inman News story).

In a statement accompanying the release of the December numbers, Countrywide Financial President and Chief Operating Officer David Sambol said the fourth quarter ended with “a number of positive operational trends. He said management “is pleased with the progress we have made in positioning the company to navigate the current challenging environment.”

Total loan fundings for the month of December 2007 were $23.5 billion, up slightly from $23.1 billion in November but down 45 percent from a year ago.

At $1.5 billion, average daily mortgage loan application activity for December was down from $1.9 billion in November. The mortgage loan pipeline also declined from $43 billion in November to $35 billion in December. Sambol attributed the declines to a seasonal trend typical for the holiday month.

The statement did not discuss the deteriorating credit quality of the 9 million loans in Countrywide’s loan servicing portfolio, although Sambol said prepayment speeds declined throughout the fourth quarter.

Delinquencies as a percentage of unpaid principal balance rose to 7.2 percent in December, up from 6.25 percent in November and 4.6 percent a year ago. Foreclosures pending as a percentage of principal balance were also up, rising from 1.28 percent in November to 1.44 percent last month — more than double the 0.7 percent rate of a year ago.

Countrywide continued to slash its loan originations workforce in December, while adding employees in loan servicing.

The Calabasas, Calif.-based lender ended the month with 22,549 workers in originations — 875 fewer than in November. Countrywide has cut 11,687 positions in originations since July, or about one in three of those it once employed.

In loan servicing, Countrywide added 167 employees, brining total employment in the department to 8,854 — up 27 percent from a year ago.


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