Flagstar Revises Earnings Again
Flagstar Bancorp Inc. increased its loss for the fourth quarter and 2011 by $4.2 million after revising a payment to settle claims regarding underwriting practices associated with loans insured by the Federal Housing Administration.
The $13.6 billion-asset company said Tuesday that based on new calculations, it lost $78.2 million in the fourth quarter and $198.9 million in 2011.
The Troy, Mich.-based mortgage banker – which ranks ninth among all originators -- revised the discount rate assumptions used in calculating the fair value of payments in the settlement after discussion with the Securities and Exchange Commission.
In February, Flagstar said it had reached an agreement with the Justice Department to pay up to $133 million to settle the claims. The bank made an initial payment of $15 million recorded last quarter and then may pay up to another $118 million in additional payments depending on its financial health.
Originally the lender said the additional payment for last quarter would total $14.1 million. Further payments will be evaluated on a quarterly basis based upon the company's progress.