Countrywide held on to the number one lender spot in 2007, in spite of growing industry turbulence and a historic mortgage crisis that is continuing unchecked to start 2008. MortgageDaily.com, a paid-subscription site focusing primarily on the primary mortgage market, reported Monday that Countrywide originated $408.2 billion during 2007, with second-place Wells Fargo trailing at $272.0 in total loan production for the year.
Per MarketWatch, the rumor mill is bandying about both Wells Fargo and Merrill Lynch as potential purchase targets for JP Morgan Chase:
First Washington Mutual, now Wells Fargo, and even talk (we're told) of Merrill Lynch. Everyone, it seems, wants to know who JP Morgan Chase is taking to the proverbial prom.
The Financial Times reported Friday morning that UBS is the latest financial institution to shake up its fixed-income trading operations, after the bank has suffered from heavy losses tied to the implosion of the subprime mortgage market.
Washington Mutual, the nation's largest thrift, reported a net loss of $1.87 billion for the fourth quarter after market close on Thursday. The loss was its first since 1997, and came as WaMu took a $1.6 billion after-tax charge to the value of its home mortgage unit and set aside $1.53 billion for credit losses.
JPMorgan Chase & Co. said Wednesday morning before market open that net income dropped 34 percent from year-ago levels to $3.0 billion in the fourth quarter, down from $4.5 billion in Q4 2006. Bloomberg reported that earnings missed analyst expectations.
Driving the drop in earnings was a $1.3 billion write down on the Wall Street bank's subprime positions, including CDOs.
In the wake of the Bank of America/Countrywide merger, numerous media outlets are reporting this morning that JP Morgan Chase is the latest financial institution hunting for an acquisition.
The Securities and Exchange Commission has opened an investigation into appraisal practices at Washington Mutual, according to a report Friday in the Wall Street Journal.
Citing unnamed sources, the Journal says the probe is in its infancy but will include "whether WaMu accurately disclosed to investors of mortgage-backed securities how its loans were appraised as well as whether the company properly accounted for its loans in financial disclosures to investors of the company."
Moody's Investors Service on Thursday downgraded the long term ratings of Bear Stearns Cos. from 'A2' to 'A1,' reacting to the Wall Street bank's first-ever quarterly loss. The downgrades affected $80 billion of the company's debt securities, Moody's said.
Bear Stearns Thursday reported its first-ever quarterly loss, posting a $854 million loss for the fourth quarter as mortgage market woes led to continuing writedowns for mortgage-backed investments and a drop in fixed-income trading revenue. The Wall Street firm said it absorbed $1.9 billion in subprime-led writedowns during the quarter, net of hedges.
Washington Mutual let fly with a market bombshell Monday that seems likely to set the stage for the fourth quarter earnings season - the company said it will likely swing to a net loss in the fourth quarter as it adjusts to "unprecedented challenges in the mortgage and credit markets."
