Impac Cuts Workforce, Lending Operations, and Dividend

Impac Mortgage Holdings announced Tuesday it will close almost all mortgage lending operations and fire 144 employees. The company will stop making "Alt-A" loans, which constituted a majority of the company's business. Alt-A loans are given to people who do not qualify for prime loans, because they cannot document all their assets or income. Impac will also halt its warehouse lending and commercial lending operations. Speaking about the restructuring, CEO Joseph Tomkinson said: "Given the severe dislocation of the marketplace, which included unprecedented margin calls, we are left with no other alternative but to downsize our company to better operate and navigate through this difficult and unrelenting environment." The company, in addition, said that it would not pay its dividend for at least the remainder of 2007. Impac stock slumped 13.1% to $1.53 in midday trading Tuesday.

Sources: Reuters, Yahoo
Commentary: Impac Tries To Stanch Alt-A Mortgage Bleed • Housing Market: The Blame Game
Stocks/ETFs to watch: IMH. Competitors: IMB. ETFs: IXG, VFH

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