Industry Watch


December 14, 2003|By From staff, New York Times and Bloomberg News reports

Mortgage lenders report lower profits, lower projections

Several mortgage lenders last week reported weak profits or lowered projections in future quarters because of a slowdown in refinancings.

Washington Mutual, one of the nation's largest mortgage lenders, said Tuesday that its earnings for the year would fall well short of forecasts.

The company, which is based in Seattle, said it planned to cut costs by $1 billion over the next year and a half, beginning in the first quarter of 2004. As part of that, Washington Mutual will eliminate 2,900 jobs.

"Now that the mortgage market has clearly slowed, we are adjusting our business to adapt to the new realities of the current environment," Kerry K. Killinger, Washington Mutual's chairman, president and chief executive, said in a statement.

Analysts have expected the mortgage-lending business to slow, in large part because refinancing activity has been red-hot for so long.

But another important reality is that long-term interest rates, which hit four-decade lows in June, cannot be expected to go much lower. An index of mortgage applications, compiled by the Mortgage Bankers Association, reached a record in June. It fell to an 18-month low last week.

Also, Countrywide Financial Corp., another large U.S. lender, said that mortgage funding in November fell 24 percent to $22.2 billion from October.

"Declining refinance activity, combined with a shortened 19-working-day month and anticipated seasonal impact on purchase fundings, resulted in a smaller overall market," Chief Operating Officer Stanford Kurland said in a statement.

Toll Brothers builders reports 4th-quarter profit

Toll Brothers Inc., the largest U.S. builder of luxury houses, said fiscal fourth-quarter profit rose 35 percent as lower borrowing costs lured buyers and kept industrywide new-home sales on track to set a record this year.

Net income climbed to $93.4 million, or $1.19 a share, in the three months that ended Oct. 31, from $69.4 million, or 93 cents, a year earlier, the Huntingdon Valley, Pa., company said. Annual profit at Toll, which does business in 21 states including Maryland, advanced 18 percent to $260 million.

Long & Foster announces some of top Oct. agents

Long & Foster Real Estate Inc. announced some of its top producers for October.

The include:

Elkton: Marge Troy, top producer and seller; John Ford, top lister and agent with most new listings; The Gregg Team as the top team.

Riverside at Waters Edge: Debra Rettberg, top producer; Bruce Hechmer, top seller; Lynn Wilson, top lister; Adrienne Earnshaw, agent with most new listings.

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