FBR Reports Mortgage-Linked 3Q Loss

Friedman, Billings, Ramsey Group Inc., an investment banking firm based in Arlington, Va., has reported a net after-tax loss of $67.4 million ($0.39 per share) for the third quarter that it attributed largely to various mortgage-related developments.The results contrasted sharply with net income of $23.0 million ($0.14 per share) for the third quarter of 2005. Noting that it had reclassified its mortgage loan portfolio in connection with a re-evaluation of its mortgage strategy, FBR said the result was a $146.8 million mark-to-market writedown in the value of the portfolio. The company also recorded a $20 million writedown of "other than temporary impairments" in its merchant banking portfolio, the majority of which it attributed to companies doing business in the nonprime mortgage sector. Also contributing to FBR's weakness in the third quarter was a $7.4 million after-tax loss at First NLC Financial Services, a wholly owned nonconforming mortgage lending subsidiary of FBR. The company can be found online at http://www.fbr.com.