Countrywide Jumps on New Financing

Countrywide Financial, the largest US mortgage lender, announced Thursday it was able to secure $12 billion in financing. The news "should substantially address funding concerns," Moshe Orenbuch, an analyst at Credit Suisse Group said in a research report which had CFC rated as an "outperform." In a statement, Countrywide President David Sambol said, "Looking forward, the company expects that it will be a long-term beneficiary of the current conditions and corrections in the mortgage industry, and we are confident that the actions which we have taken in response to the current environment will position us for profitable future growth and success." Countrywide used its entire $11.5 billion credit-line and sold $2 billion in preferred shares to Bank of America in August. Last week, CFC announced it would cut up to 20% of its workforce to cut costs. Since the beginning of last year, more than 100 mortgage companies have gone out of business or put themselves up for sale because of subprime and housing issues. Countrywide shares closed Thursday +13.9% to $18.93.

Sources: TheStreet.com, Bloomberg
Commentary: Countrywide Seeks More Capital - NY Post • Countrywide Takes Steps to Survive Credit Crunch
Stocks/ETFs to watch: CFC. Competitors: NDE, WFC. ETFs: PGF, IYF
Earnings call transcript: Countrywide Financial Q2 2007

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Comments

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Shouldn't we be getting details on the additional financing?
Like the source or the terms?

If the terms were favorable I'm sure they would have been happy to disclose them.