IndyMac Reports 2Q Profit Decline

IndyMac Bancorp Inc., Pasadena, Calif., has reported net earnings of $44.6 million ($0.60 per share) for the second quarter, down 57% from $104.7 million ($1.49 per share) a year earlier.IndyMac's mortgage loan production totaled $22.5 billion in the second quarter, down 12% from that of the first quarter, the company said. Michael Perry, the company's chairman and chief executive officer, said IndyMac's 8.6% return on equity was below its 10% forecast because the forecast had included a gain from the sale/leaseback of a commercial property housing one of its mortgage loan centers. The sale resulted in a $60 million pretax gain, but $24 million will be recorded in the third quarter and the remainder will be deferred, he said. "While our ROE for the quarter is below our historical performance, it must be considered solid given current conditions in the mortgage and housing markets," Mr. Perry said. "Once again, the balance provided by our hybrid thrift/mortgage banking model protected us in this environment. Our mortgage production business, while down slightly from last quarter, had earnings of $38 million and a solid 21% ROE, despite a high level of costs, which had been anticipated." IndyMac can be found online at http://www.indymacbank.com.