Stung by Mortgage Woes, NatCity Profits Fall 80%

Meanwhile, National City Corp. saw its third-quarter net income slide by 80% because of writedowns and higher delinquencies on its residential mortgage business.The company reported third-quarter net income of $106 million, compared with $526 million a year earlier. The earnings release came a day after NatCity said it was shutting its correspondent residential unit but will remain a retail and wholesale lender (see item above). "Our third-quarter results were clearly affected by the unprecedented disruption and weakness in the mortgage and housing markets," said NatCity president and chief executive Peter Raskind. He noted that the bank has restructured its mortgage business, merging its National Home Equity unit into National City Mortgage. It has also severely curtailed the origination of non-agency-eligible mortgages. "Loans held for sale have been written down to estimated market prices, and in certain cases, moved to portfolio," Mr. Raskind said.