Thornburg Mortgage Swings to Fourth Quarter Profit

February 4, 2008 No Comments »


Thornburg Mortgage swung to a fourth quarter profit just months after announcing a $1 billion third-quarter loss, despite ongoing housing woes rattling the industry as a whole.

The Santa Fe, New Mexico-based mortgage lender reported net income of $64.8 million, or 33 cents a share, compared to profit of $80.3 million, or 68 cents, during the same period a year earlier.

The results beat analyst expectations, who on average expected a fourth-quarter profit of 27 cents per share, according to Reuters Estimates.

Thornburg said it originated $516.7 million in home loans and acquired $995.4 million of new mortgage securities during the fourth quarter.

The company said its goal is to originate $6.1 billion in mortgage loans in 2008, noting that as of the end of January, it had already funded $346.7 million in loans.

As of December 31, 2007, 60-day plus delinquent loans and real-estate owned properties (REO) in the company’s originated and bulk purchased loans totaled just 0.44 percent of its $24.6 billion loan portfolio, up from 0.27 percent the prior quarter.

The company noted that $630.6 million of pay option ARMs purchased from one seller was effectively doubling its total portfolio delinquency rate.

But despite the rise, Thornburg is clearly performing much better than the industry, which chalked a conventional prime adjustable-rate mortgage loan delinquency rate of 4.23% as of September 30, 2007.

Thornburg specializes in the origination of jumbo and super jumbo adjustable-rate mortgages, working with prime borrowers with superior credit.

The company said its average correspondent loan amount grew to $984,000 last year from $818,000 in 2006, while its average wholesale loan amount was $1.2 million in 2007.

Shares of Thornburg closed today’s session day down 37 cents, or 3.18%, to $11.28 in trading on Wall Street.

(photo: topdrawersausage)

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