Countrywide's Profits Rise

Countrywide Financial Corp., Calabasas, Calif., has reported net earnings of $2.5 billion ($4.11 per share) for 2005, compared with $2.2 billion ($3.63 per share) in 2004, citing record annual mortgage volume amid declining profit margins on prime loans.Countrywide said loan production volume totaled a company and industry record $491 billion for the year, compared with $363 billion in 2004. For the fourth quarter, the company reported earnings of $639 million ($1.04 per share), up 73% from $370 million ($0.61 per share) a year earlier. "Importantly, we achieved these results despite an environment that included volatile interest rates; declining production profit margins throughout the industry; and the adverse effects of 2005's hurricanes, primarily Hurricane Katrina," said Angelo R. Mozilo, Countrywide's chairman and chief executive officer. "If not for the hurricane charges, the company would have surpassed its record of $4.18 per diluted share, achieved in the peak refinance boom year of 2003." Countrywide's prime margins declined to 65 basis points in the fourth quarter, down 11 bps from those of the previous quarter and 25 bps from a year earlier, the company said. The servicing portfolio grew to $1.1 trillion as of Dec. 31, up from $838 billion a year earlier. Countrywide can be found online at http://www.countrywide.com.