WaMu's Mortgage Income Plummets by $1B+

The net income of Washington Mutual Inc.'s home loan segment plummeted by more than $1 billion last year, although profits exceeded $3.5 billion for the company overall, the Seattle-based thrift has reported.WaMu reported a net loss of $48 million in its Home Loans Group for 2006, compared with net income of $1.03 billion in 2005. For the fourth quarter, the thrift reported a net loss of $122 million in the Home Loans Group, compared with a $24 million loss in the previous quarter and net income of $57 million in the fourth quarter of 2005. Originations of home loans declined 6% in the fourth quarter and 22% for the year. WaMu attributed the nosedive in the mortgage segment's profits to "the continued slowing of the housing market and a significant weakening of overall subprime market conditions." The company said higher delinquencies on subprime home loans and weaker market conditions shaved $160 million from its pretax earnings in the fourth quarter. Overall, WaMu reported net income of $3.56 billion ($3.64 per share) for the year, up from $3.43 billion ($3.73 per share) for 2005. WaMu can be found online at http://www.wamu.com.