American Banker reports on the latest from IndyMac (subscription required and highly recommended, hat tip to AB reporter Kate Berry):
IndyMac Bancorp Inc. … is taking a hard look at how it acquires loans and to whom it sells them. The $32 billion-asset thrift company … said it is considering shuttering its conduit production unit. It said the move would free $250 million of capital within 90 days. Margins in this channel, which buys loans in bulk, have narrowed, and its volume fell 37% from the first quarter. We’re going to be very cautious about what we buy with the conduit and we could easily shut it down,â€? Michael Perry, IndyMac’s chairman and chief executive, said in an interview Tuesday. â€œOne of the things you do when your stock is trading below book is anything that has a low return on equity to shareholders, you just shut it down.â€?
I noted earlier that IndyMac’s thrift charter was likely to be its saving grace — this would seem to underscore such a point.