Stock of Impac Mortgage Holdings in Irvine fell 13.22 percent today to close at $2.56, as jittery investors digested news that American Home Mortgage Investment Corp., another mortgage REIT, faces a liquidity crisis.
MarketWatch has a story on the day’s events (hat tip to graphrix):
American Home Mortgage Investment Corp., the 10th largest mortgage lender in the U.S., teetered on the brink of bankruptcy on Tuesday after saying it can’t pay back its creditors, potentially becoming the first big lender outside the subprime mortgage business to go bust.
Shares of the company plunged 90% to close at $1.04.
“They will either file for bankruptcy or do some sort of material restructuring that will leave equity investors with very little,” Bose George, an analyst at Keefe Bruyette & Woods, said in an interview. “It sounds like there’s very little capital left.”
And the story goes on:
Other mortgage lenders also fell on Tuesday after American Home warned that investors in the secondary mortgage market have stopped buying loans from a variety of originators.
Impac Mortgage Holdings and NovaStar Financial dropped more than 14%. (Blogger’s note: Impac dropped 13.22 percent in regular trading, and is down another 8 percent in after hours trading as I write this.)
Impac and NovaStar “have exactly the same reliance on capital markets as American Home,” KBW’s George said. He covers Impac, but not NovaStar.
Jeez,
We told you the credit crunch was coming, but Ken and Never told you it wasn’t. That it would never happen.
Who do you want to listen to now?
3 Words:
Duck and Cover.
Chuck Ponzi
Author of http://www.socalbubble.com
[...] Investment Corp., another mortgage REIT, faces a liquidity crisis. … article continues at Matt brought to you by loan and [...]
the subprime are going to hell
Look for major developments to occur on the Impac home front on Wednesday at market close (if they make it that far without the SEC halting their trading). This free fall has no visible parachute.
Not even IndyMac can run to their rescue here.
As much as they would like everyone to believe that they are being subjected to guilt by association, all one needs to do is greed between the lines.
Dr. What? Who? Explain why Countrywide dropped 27% and Indy Mac dropped 29% in value over the past 30 days. All financial stocks are suffering because of illiquidity in the entire market. You can only fund so many loans before even the big one’s run out of cash. Indy Mac is having it’s own issues with massive losses, margin calls, layoffs, liquidity, etc. Mike Perry is echoing Angelo’s remarks that things don’t look good for anyone at this point. Wednesday’s market has closed. Where’s the major development?? Not much of a sooth sayer Doc.
I believe Impac probably will also be shut down in the next 30-60 days.
I could be wrong however but I know there CEO is quite wrong saying that his company will be fine during this crisis
Where is Joe when you need him? I’m worried Wallstreet is once again on the verge of throwing ANOTHER baby out with the bath water.
When Impac and Novastar shut there doors who will be left.
Matt: Please see if you can bring Joe in for another interview where he can plead the victim of guilt by association….. (please ignore any references to performance issues).
Then follow up with interviews with the following victims past and present:
Mark Ernst - Option One
Neil Kornswiet - People Choice
Scott Harman - Novastar
James Konrath - Accredited
Kyle Walker - Fremont (former CEO)
I am sure they all have a story to tell to make tears well up in our eyes.
Trust me, they knew or know what was coming, what type of lending they were doing, and there is no “plausible deniability”. But they will all retire peacefully in their palacial estates……. who are the victims in this debacle?