Countrywide Financial
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Countrywide Financial Corporation (NYSE: [CFC]
Financials
Financials Quarterly (Mar '06) Annual (2005) Income Statement (in millions of USD) Total Revenue 2,835.95 10,016.71 Gross Profit 2,956.60 9,523.18 Operating Income 1,119.36 4,147.77 Net Income 683.51 2,528.09
Balance Sheet (in millions of USD) Total Assets 177,592.06 175,085.37 Total Liabilities 164,085.80 162,269.51 Total Equity 13,506.25 12,815.86
Cash Flow (in millions of USD) Net Income/Starting Line 683.51 2,528.09 Cash from Operating 3,270.26 -11,700.78 Cash from Investing -2,458.60 -41,768.32 Cash from Financing 801.85 53,748.97 Net Change in Cash 1,613.51 279.87
Businesses
Countrywide was founded in 1969 by David Loeb and Angelo Mozilo
Mortgage Banking
The Mortgage Banking segment produces mortgage loans through a variety of channels on a national scale. Nearly all of the mortgage loans the Company produces in this segment are sold into the secondary mortgage market, primarily in the form of mortgage-backed securities. The Company generally performs the ongoing servicing functions related to the mortgage loans that it produces. It also provides various loan closing services, such as title, escrow and appraisal.
The Mortgage Banking segment consists of three distinct sectors, such as Loan Production, Loan Servicing and Loan Closing Services. The Loan Production Sector produces mortgage loans through four divisions of Countrywide Home Loans, including Consumer Markets, Wholesale Lending, Correspondent Lending and Full Spectrum Lending.
The Correspondent Lending division purchases mortgage loans from other lenders, which include mortgage bankers, commercial banks, savings and loan associations, home builders and credit unions. As of December 31, 2005, this division served approximately 2,100 lenders, who are subject to initial and ongoing credit evaluation and monitoring, operating in all 50 states and the District of Columbia. The Full Spectrum Lending primarily originates non-prime mortgage loans through a network of 195 retail branch offices located in 38 states, as well as seven call centers. The branches of this division are supported by three fulfillment centers that underwrite and fund branch-originated loans.
Loan Closing Services
LandSafe and its subsidiaries offer loan closing services. LandSafe Appraisal Services, Inc. provides real estate appraisal services. LandSafe Credit Services, Inc. (LSC) provides automated credit reporting products. LandSafe Flood Determination, Inc. offers flood determination services. LandSafe Title provides residential title services for the six major counties of Southern California.
Capital Markets
The Capital Markets segment primarily operates as a registered securities broker dealer, a residential mortgage loan manager and a commercial mortgage loan originator. CFC also operates broker dealers in Japan and the United Kingdom, an introducing broker dealer of futures contracts, an asset manager and a broker of mortgage servicing rights. With the exception of its commercial mortgage activities, the Company transacts only with institutional customers, such as banks, other depository institutions, insurance companies, asset managers, mutual funds, pension plans, other broker dealers and governmental agencies. Customers of its commercial real estate finance business are the owners or sponsors of commercial properties, who can be individuals or institutions.
Countrywide Asset Management Corporation manage the acquisition and disposition of loans from third parties, as well as loans originated by Countrywide Home Loans, on behalf of Countrywide Home Loans. These are typically delinquent or otherwise illiquid residential mortgage loans, which have primarily been originated under Federal Housing Administration (FHA) and Veterans Administration (VA) programs. The Company attempts to rehabilitate the loans, using the servicing operations of Countrywide Home Loans, with the intent to securitize those loans that become eligible for securitization. The remaining loans are serviced through foreclosure and liquidation, which includes the collection of government insurance and guarantee proceeds relating to defaulted FHA and VA program loans.
Securities trading activities include the trading of debt securities in the secondary market after the original issuance of the security. Underwriting activities encompass the assumption of the risk of buying a new issue of securities from the issuer and reselling the securities to investors, either directly or through dealers. Capital Markets primarily underwrites mortgage-related debt securities.
Banking
The Banking segment consists of Countrywide Bank, N.A and Countrywide Warehouse Lending. The Company's Banking Operation primarily originates and purchases mortgage loans and home equity lines of credit for investment purposes. The majority of these loans are sourced through its mortgage banking subsidiary, Countrywide Home Loans. The Bank obtains retail deposits, primarily certificates of deposit, through the Internet, call centers and 86 financial centers, 73 of which are located in Countrywide Home Loans' retail branch offices as of December 31, 2005. Through Countrywide Warehouse Lending, CFC provides committed and uncommitted warehouse lines of credit to mortgage bankers to finance their mortgage loan inventories. Most of these mortgage bankers sell loans to the Company's Correspondent Lending division.
Insurance
The Insurance segment activities include offering property, casualty, life and credit insurance as an underwriter and as an insurance agency, and providing reinsurance coverage to primary mortgage insurers, through two business units, such as Balboa Life and Casualty Operations, and Balboa Reinsurance Company. Balboa Life and Casualty Group underwrite property, casualty, life and credit insurance in all 50 states through the Balboa Life and Casualty Group. Its products include Lender-Placed Property and Auto, which includes lender-placed auto insurance and lender-placed, real-property hazard insurance; Voluntary Homeowners and Auto, which underwrites retail homeowners insurance and home warranty plans for consumers, and Life and Credit, which underwrites term life, credit life and credit disability insurance products.
Balboa Reinsurance Company provides a mezzanine layer of reinsurance coverage for losses between minimum and maximum specified amounts to the insurance companies that provide primary mortgage insurance (PMI) on loans in its servicing portfolio. It provides this coverage with respect to substantially all of the loans in the Company's portfolio that are covered by PMI, which generally includes all conventional loans with an original loan amount in excess of 80% of the property's appraised value. In return for providing this coverage, it earns a portion of the PMI premiums.
Global Operations
The primary activities of the Global Operations segment include: Loan Processing and Subservicing, which provides mortgage loan application processing and mortgage loan subservicing in the United Kingdom; Offshore Services, which commenced operations in India in 2004, and provides business process and technology services to the Company in both the United States and the United Kingdom, and Valuation Services, which provide electronic residential property valuation services to third parties in the United Kingdom through a majority-owned joint venture. In 2005, the operation processed more than 11.3 billion pounds sterling ($20.3 billion) in loans, all of which are subserviced for Barclays Bank, PLC, the joint venture partner. As of December 31, 2005, Global's subservicing portfolio was 59 billion pounds sterling ($102 billion).
Management
Angelo R. Mozilo > Chairman of the Board, Chief Executive Officer
Officer Since: 03/1969Age: 67 Bio & Compensation - Reuters
Stanford L. Kurland > President, Chief Operating Officer, Director
Officer Since: 1979Age: 53 Bio & Compensation - Reuters
Eric P. Sieracki > Chief Financial Officer, Executive Managing Director
Age: 49Bio & Compensation - Reuters
Laura K. Milleman > Senior Managing Director, Chief Accounting Officer
Officer Since: 07/1999Age: 45 Bio & Compensation - Reuters
Marshall Gates > Senior Managing Director, Chief Administrative Officer
Officer Since: 1988Age: 54 Bio & Compensation - Reuters Trading Activity - Yahoo Finance
James Furash > Senior Managing Director, President & Chief Executive Officer of Treasury Bank, N.A.
Officer Since: 2001Age: 46 Bio & Compensation - Reuters
Andrew Gissinger > Senior Managing Director, Chief Production Officer,Countrywide Home Loans
Age: 46Bio & Compensation - Reuters Trading Activity - Yahoo Finance
Ranjit Kripalani > Senior Managing Director and President, Capital Markets
Officer Since: 1998Age: 46 Bio & Compensation - Reuters Trading Activity - Yahoo Finance
Anne D. McCallion > Senior Managing Director, Chief of Financial Operations and Planning
Officer Since: 1991Age: 51 Bio & Compensation - Reuters
Sandor E. Samuels > Senior Managing Director, Chief Legal Officer and Assistant Secretary
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