UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported): August 10, 2004
COUNTRYWIDE FINANCIAL CORPORATION
(Exact name of registrant as specified in its chapter)
Delaware
(State or other jurisdiction
of incorporation) | 1-8422
(Commission
File Number) | 13-2641992
(IRS Employer
Identification No.) |
4500 PARK GRANADA, CALABASAS CA
(Address of principal executive offices) | 91302
(Zip Code) |
Registrant's telephone number, including area code: (818) 225-3000
Item 12. Results of Operations and Financial Condition
On August 10, 2004, the Company issued a press release announcing information regarding its operational statistics for the month ended July 31, 2004, a copy of which is attached as Exhibit 99.17. On August 10, 2004, the Company also made available an updated version of its thirteen-month statistical data report on its website,www.countrywide.com, a copy of which is attached as Exhibit 99.18.
The information furnished pursuant to this Current Report on Form 8-K (including the exhibits hereto) shall not be considered “filed” under the Securities Exchange Act of 1934, as amended, nor shall it be incorporated by reference into any of the Company’s filings under the Securities Act of 1933, as amended, or under the Securities Exchange Act of 1934, as amended, unless the Company expressly states in such filing that such information is to be considered “filed” or incorporated by reference therein.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on behalf of the undersigned hereunto duly authorized.
| COUNTRYWIDE FINANCIAL CORPORATION |
| Dated: August 10, 2004 | By: /S/ STANFORD L. KURLAND
Stanford L. Kurland
President and Chief Operating Officer |
EXHIBIT INDEX
| 99.17 | Press Release issued by Countrywide Financial Corporation (the “Company”) pertaining to its operational statistics for the month ended July 31, 2004. |
| 99.18 | Thirteen-month statistical data report made available by the Company on its website. |
Exhibit 99.17
| NEWS | COUNTRYWIDE FINANCIAL |
| INVESTOR CONTACT: | (818) 225-3550
David Bigelow or
Lisa Riordan |
| MEDIA CONTACT: | (800) 796-8448 |
For Immediate Release
COUNTRYWIDE REPORTS JULY 2004 OPERATIONAL DATA
– YEAR-TO-DATE LOAN PRODUCTION EXCEEDS $200 BILLION –
– PIPELINE OF APPLICATIONS-IN-PROCESS REMAINS STRONG AT $48 BILLION –
– SERVICING PORTFOLIO HITS $747 BILLION –
CALABASAS, CA (August 10, 2004) – Countrywide Financial Corporation (NYSE: CFC), a diversified financial services provider, released operational data for the month ended July 31, 2004. Highlights included the following:
- Loan fundings were $30 billion for the month, a decline of 7 percent from the prior month, and a decrease of 43 percent from July 2003, which was the single largest funding month in the Company’s history. Year-to-date funding volume reached $206 billion.
- Monthly purchase activity rose modestly over last month’s record high, marking a new milestone at $18 billion. On a year-over-year basis, monthly purchase fundings advanced 31 percent over July 2003. Year-to-date purchase volume was $95 billion, exceeding the $86 billion in purchase volume achieved in all of calendar 2002.
- Demand for adjustable-rate, home equity and subprime loans remained strong.
| - | Adjustable-rate fundings of $17 billion were 98 percent greater than the same month last year and accounted for 57 percent of total loan volume. This brought year-to-date adjustable-rate volume to $99 billion, surpassing the $92 billion produced in calendar 2003. |
| - | Home equity fundings reached a record $2.8 billion, rising 68 percent over July 2003, driving year-to-date volume to $15 billion. |
| - | Subprime volume grew 119 percent over July 2003 to $3.8 billion. Year-to-date subprime volume of $20 billion surpassed total subprime volume in calendar 2003. |
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2-2-2
- As compared to the prior month, average daily application volume grew by 5 percent to $2 billion due to a greater level of home purchase activity, which fueled a 2 percent increase in the pipeline of applications-in-process to $48 billion. However, as a result of lower refinance activity when compared to July 2003, average daily application volume was down 21 percent and the pipeline of applications-in-process fell by 32 percent.
- The servicing portfolio hit a record $747 billion, advancing $102 billion since the beginning of the year and 30 percent, or $170 billion, since July 2003.
- Securities trading volume of $267 billion for the month of July was down 18 percent from July 2003, driven primarily by the lower level of mortgage production as compared to the same time last year. This brought year-to-date trading volume to $1.8 trillion.
- Total assets at Countrywide Bank grew by 103 percent over July 2003 and rose 5 percent over last month to $29 billion.
- Net earned premiums at Balboa of $67 million were 3 percent higher than July 2003 and up 5 percent over the prior month.
- Sub-servicing volume at Global Home Loans of $110 billion was 16 percent greater than July 2003.
“July marked another month of solid operational performance for Countrywide,” said Stanford L. Kurland, President and Chief Operating Officer. “Our loan production efforts were notable, as year-to-date funding volume surpassed the $200 billion level, and new monthly volume records were achieved in purchase, home equity and subprime production. The pipeline of applications-in-process continues to be robust at $48 billion, fueled by a surge in home purchase activity late in the month. Looking ahead, the 20 basis point decline in the 10-year U.S. Treasury yield that occurred during the first week of August is likely to increase near-term mortgage application activity.
“The servicing portfolio continued its uninterrupted climb, reaching $747 billion,” Kurland continued. “Importantly, Countrywide remained the #1 mortgage lender in the second quarter and rose to become the second largest servicer, according to recently released data fromInside Mortgage Finance. Our growing strength in Mortgage Banking, coupled with sound performance from our Diversified Businesses, continues to enhance Countrywide’s position to perform well in a variety of interest rate environments.”
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Founded in 1969, Countrywide Financial Corporation is a member of the S&P 500, Forbes 2000 and Fortune 500. Through its family of companies, Countrywide provides mortgage banking and diversified financial services in domestic and international markets. Mortgage banking businesses include loan production and servicing principally through Countrywide Home Loans, Inc., which originates, purchases, securitizes, sells, and services primarily prime-quality loans. Also included in Countrywide’s mortgage banking segment is the LandSafe group of companies that provide loan closing services. Diversified financial services encompass capital markets, banking, insurance, and global operations, largely through the activities of Countrywide Capital Markets, a mortgage-related investment banker; Countrywide Bank, a division of Treasury Bank, NA, a banking entity offering customers CDs, money market accounts, and home loan products; Balboa Life and Casualty Group, whose companies are national providers of property, liability, and life insurance; Balboa Reinsurance, a captive mortgage reinsurance company; and Global Home Loans, a U.K. mortgage banking joint venture in which Countrywide holds a majority interest.
For more information about the Company, visit Countrywide’s website at www.countrywide.com.
This Press Release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, regarding management’s beliefs, estimates, projections, and assumptions with respect to future operations, as well as business plans and strategies that are subject to change. Actual results and operations for any future period may vary materially from those projected herein and from past results discussed herein. Factors which could cause actual results to differ materially from historical results or those anticipated include, but are not limited to: competitive and general economic conditions in each of our business segments; general economic conditions in the United States and abroad; loss of investment grade rating that may result in an increase in the cost of debt or loss of access to corporate debt markets; reduction in government support of homeownership; the level and volatility of interest rates; the legal, regulatory and legislative environments in the markets in which the Company operates; and other risks detailed in documents filed by the Company with the Securities and Exchange Commission from time to time. Words like “believe,” “expect,” “anticipate,” “promise,” “plan,” and other expressions or words of similar meanings, as well as future or conditional verbs such as “will,” “would,” “should,” “could,” or “may” are generally intended to identify forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements.
(tables follow)
COUNTRYWIDE FINANCIAL CORPORATION AND SUBSIDIARIES
OPERATING STATISTICS(1)
(Dollars in Millions)
Month Ended Year-to-Date
----------------------------------- ----------------
July 31, July 31, July 31,
2004 2003 2004
---------------- --------------- ----------------
LOAN PRODUCTION
- ---------------
Average Daily Loan Applications $ 2,006 $ 2,529
Mortgage Loan Pipeline (loans in process) $ 48,142 $ 70,377
Consumer Markets Division Fundings $ 8,841 $ 12,911 $ 62,634
Wholesale Lending Division Fundings 5,376 10,531 40,862
Correspondent Lending Division Fundings 10,405 24,258 77,100
Capital Markets Fundings 2,396 2,884 10,319
Treasury Bank Fundings (2) 2,686 1,255 14,656
---------------- --------------- ----------------
Total Loan Fundings $ 29,704 $ 51,839 $ 205,571
---------------- --------------- ----------------
Consumer Markets Division Units 63,813 94,839 451,144
Wholesale Lending Division Units 30,710 58,930 230,726
Correspondent Lending Division Units 60,992 139,360 437,414
Capital Markets Units 9,949 11,922 39,923
Treasury Bank Units 26,236 17,376 151,343
---------------- --------------- ----------------
Total Loan Units 191,700 322,427 1,310,550
---------------- --------------- ----------------
Purchase Fundings (3) $ 17,541 $ 13,352 $ 95,117
Non-purchase Fundings (3) 12,163 38,487 110,454
---------------- --------------- ----------------
Total Loan Fundings $ 29,704 $ 51,839 $ 205,571
---------------- --------------- ----------------
Government Fundings $ 1,039 $ 2,790 $ 8,692
ARM Fundings $ 17,021 $ 8,580 $ 99,407
Home Equity Fundings $ 2,838 $ 1,694 $ 15,428
Subprime Fundings $ 3,785 $ 1,726 $ 20,231
LOAN CLOSING SERVICES (units)
- -----------------------------
Credit Reports 630,223 624,949 4,281,524
Flood Determinations 243,241 308,255 1,605,857
Appraisals 62,732 68,677 412,103
Automated Property Valuation Services 467,030 416,691 3,006,553
Other 13,252 12,791 103,572
---------------- --------------- ----------------
Total Units 1,416,478 1,431,363 9,409,609
---------------- --------------- ----------------
LOAN SERVICING (4)
- ---------------
Volume $ 746,905 $ 576,670
Units 5,668,620 4,678,947
Subservicing Volume (5) $ 16,843 $ 11,645
Subservicing Units 172,602 143,937
Prepayments in Full $ 12,430 $ 33,361 $ 109,319
Bulk Servicing Acquisitions $ 4,187 $ 345 $ 17,684
Portfolio Delinquency (%) - CHL (6) 3.51% 3.78%
Foreclosures Pending (%) - CHL (6) 0.37% 0.46%
COUNTRYWIDE FINANCIAL CORPORATION AND SUBSIDIARIES
OPERATING STATISTICS(1)
(Dollars in Millions)
Month Ended Year-to-Date
---------------------------------- ----------------
July 31, July 31, July 31,
2004 2003 2004
--------------- --------------- ----------------
INSURANCE
- ---------
Net Premiums Earned:
Carrier $ 54 $ 54 $ 361
Reinsurance 13 11 89
--------------- --------------- ----------------
Total Net Premiums Earned $ 67 $ 65 $ 450
--------------- --------------- ----------------
CAPITAL MARKETS
- ---------------
Securities Trading Volume (7) $ 266,645 $ 326,751 $ 1,838,660
BANKING
- -------
Assets Held by Treasury Bank (in billions) $ 28.6 $ 14.1
GLOBAL OPERATIONS
- -----------------
Global Home Loans Subservicing
Volume (in billions) $ 110 $ 95
Period-end Rates
- ----------------
10-Year U.S. Treasury Yield 4.477% 4.476%
FNMA 30-Year Fixed Rate MBS Coupon 5.484% 5.722%
Number of Working Days in the Period
21 22 147
| (1) | The above data reflect current operating statistics and do not constitute all factors impacting the quarterly and annual financial results of the Company. All figures are unaudited and monthly figures may be adjusted in the reported financial statements of the Company. Such financial statements are provided by the Company quarterly. The Company makes no commitment to update this information for changes in circumstances or events which occur subsequent to the date of this release. |
| (2) | Treasury Bank funds loans for investment purposes; these loans are processed for Treasury Bank by the production divisions. |
| (3) | We have enhanced our disclosure of the first trust deed and home equity loan funding mix to reflect purchase and non-purchase fundings. Purchase fundings include first trust deed and home equity loans used as purchase money debt in the acquisition of a home. Non-purchase fundings include first trust deed refinance loans, home equity refinance loans and stand-alone home equity loans. |
| (4) | Includes warehouse loans and loans under subservicing agreements for other clients. |
| (5) | Subservicing volume for other clients. |
| (6) | Expressed as a percentage of the total number of loans serviced, excluding subserviced loans and portfolios purchased at a discount due to their non-performing status. |
| (7) | Includes trades with Mortgage Banking Division. |
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Exhibit 99.18
Countrywide Financial Corporation
Rolling Thirteen Months Statistical Data
($ in millions)
Jul-03 Aug-03 Sep-03 Oct-03 Nov-03 Dec-03 Jan-04 Feb-04 Mar-04 Apr-04 May-04 Jun-04 Jul-04 YTD
------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ---
LOAN PRODUCTION
- ---------------
Number of Working Days in the
Period 22 21 21 23 19 22 20 19 23 22 20 22 21 147
Average Daily Loan Applications $2,529 $1,808 $1,858 $1,564 $1,479 $1,339 $1,776 $1,968 $2,455 $2,041 $1,945 $1,905 $2,006 $2,022
Mortgage Loan Pipeline
(loans-in-process) $70,377 $53,576 $47,182 $42,650 $38,841 $32,969 $38,354 $43,760 $57,422 $54,836 $49,675 $47,317 $48,142
Consumer Markets Division
Fundings $12,911 $12,283 $9,392 $8,198 $6,954 $7,670 $6,211 $7,326 $9,522 $11,115 $9,815 $9,804 $8,841 $62,634
Wholesale Lending Division
Fundings 10,531 7,222 5,632 6,235 4,725 4,902 3,844 4,801 6,993 7,727 6,208 5,913 5,376 40,862
Correspondent Lending Division
Fundings 24,258 17,870 13,225 10,908 8,598 9,390 8,240 8,518 12,029 14,362 11,986 11,560 10,405 77,100
Capital Markets Fundings 2,884 2,059 3,066 2,314 829 1,489 1,013 1,046 1,265 494 1,875 2,230 2,396 10,319
Treasury Bank Fundings (1) 1,255 1,541 1,802 1,310 1,100 1,698 1,312 1,582 2,502 2,147 1,931 2,496 2,686 14,656
--------- --------- --------- ---------- --------- --------- --------- --------- --------- ---------- --------- --------- --------- -- ---------
Total Loan Fundings $51,839 $40,975 $33,117 $28,965 $22,206 $25,149 $20,620 $23,273 $32,311 $35,845 $31,815 $32,003 $29,704 $205,571
========= ========= ========= ========== ========= ========= ========= ========= ========= ========== ========= ========= ========= == =========
Consumer Markets Division Units 94,839 92,465 74,566 67,213 57,058 61,031 49,154 54,962 68,664 75,880 68,759 69,912 63,813 451,144
Wholesale Lending Division Units 58,930 42,036 34,660 38,255 28,887 29,638 22,685 27,880 39,820 42,114 34,247 33,270 30,710 230,726
Correspondent Lending Division
Units 139,360 104,396 81,376 67,709 52,969 57,079 49,694 50,250 67,815 77,570 65,425 65,668 60,992 437,414
Capital Markets Units 11,922 6,303 9,718 9,266 4,629 6,357 4,680 3,491 5,114 1,463 6,740 8,486 9,949 39,923
Treasury Bank Units 17,376 18,060 18,352 14,938 13,257 16,861 14,681 16,760 23,351 21,909 21,779 26,627 26,236 151,343
--------- --------- --------- ---------- --------- --------- --------- --------- --------- ---------- --------- --------- --------- -- ---------
Total Loan Units 322,427 263,260 218,672 197,381 156,800 170,966 140,894 153,343 204,764 218,936 196,950 203,963 191,700 1,310,550
========= ========= ========= ========== ========= ========= ========= ========= ========= ========== ========= ========= ========= == =========
Purchase Fundings (2) $13,352 $12,571 $12,719 $12,366 $9,852 $12,115 $9,274 $9,226 $13,127 $13,883 $14,575 $17,491 $17,541 $95,117
Non-purchase Fundings (2) 38,487 28,404 20,398 16,599 12,354 13,034 11,346 14,047 19,184 21,962 17,240 14,512 12,163 110,454
--------- --------- --------- ---------- --------- --------- --------- --------- --------- ---------- --------- --------- --------- -- ---------
Total Loan Fundings $51,839 $40,975 $33,117 $28,965 $22,206 $25,149 $20,620 $23,273 $32,311 $35,845 $31,815 $32,003 $29,704 $205,571
========= ========= ========= ========== ========= ========= ========= ========= ========= ========== ========= ========= ========= == =========
Government Fundings $2,790 $2,505 $2,093 $1,774 $1,370 $1,343 $1,161 $1,117 $1,530 $1,491 $1,235 $1,119 $1,039 $8,692
ARM Fundings $8,580 $10,011 $10,072 $10,676 $8,487 $9,679 $9,478 $10,293 $13,872 $15,739 $15,745 $17,259 $17,021 $99,407
Home Equity Fundings $1,694 $1,697 $1,680 $1,752 $1,620 $1,805 $1,564 $1,637 $2,088 $2,242 $2,272 $2,787 $2,838 $15,428
Subprime Fundings $1,726 $1,654 $2,158 $2,424 $2,029 $2,257 $2,009 $2,124 $2,759 $2,765 $3,044 $3,745 $3,785 $20,231
LOAN CLOSING SERVICES (units)
- -----------------------------
Credit Reports 624,949 492,787 499,431 518,308 420,843 405,336 533,055 547,704 738,113 626,142 574,524 631,763 630,223 4,281,524
Flood Determinations 308,255 234,552 222,890 217,134 173,044 172,325 188,682 195,380 277,958 246,580 214,494 239,522 243,241 1,605,857
Appraisals 68,677 60,025 51,507 53,783 44,475 47,004 44,146 51,425 69,074 65,975 58,912 59,839 62,732 412,103
Automated Property Valuation
Services 416,691 349,978 358,983 399,559 314,886 319,220 333,803 356,077 439,015 473,601 456,663 480,364 467,030 3,006,553
Other 12,791 12,566 11,769 11,457 9,741 12,096 14,750 14,218 16,379 16,058 13,583 15,332 13,252 103,572
--------- --------- --------- ---------- --------- --------- --------- --------- --------- ---------- --------- --------- --------- -- ---------
Total Units 1,431,363 1,149,908 1,144,580 1,200,241 962,989 955,981 1,114,436 1,164,804 1,540,539 1,428,356 1,318,176 1,426,820 1,416,478 9,409,609
========= ========= ========= ========== ========= ========= ========= ========= ========= ========== ========= ========= ========= == =========
| (1) | Treasury Bank funds loans for investment purposes; these loans are processed for Treasury Bank by the production divisions. |
| (2) | We have enhanced our disclosure of the first trust deed and home equity loan funding mix to reflect purchase and non-purchase fundings. Purchase fundings include first trust deed and home equity loans used as purchase money debt in the acquisition of a home. Non-purchase fundings include first trust deed refinance loans, home equity refinance loans and stand-alone home equity loans. |
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Countrywide Financial Corporation
Rolling Thirteen Months Statistical Data
($ in millions)
LOAN SERVICING (3)
- ------------------
Volume $576,670 $591,905 $606,095 $621,000 $631,470 $644,855 $657,541 $669,076 $682,848 $693,768 $706,943 $726,227 $746,905
Units 4,678,947 4,760,141 4,834,943 4,923,935 5,001,743 5,080,621 5,162,726 5,234,634 5,313,058 5,372,526 5,443,555 5,547,050 5,668,620
Subservicing Volume (4) $11,645 $11,483 $11,446 $11,921 $13,671 $14,404 $15,871 $15,548 $15,307 $15,028 $15,289 $16,027 $16,843
Subservicing Units 143,937 142,527 128,326 139,983 157,785 159,357 166,923 163,190 166,514 163,842 163,931 163,396 172,602
Prepayments in Full $33,361 $25,236 $17,463 $14,315 $11,403 $11,845 $9,387 $13,090 $18,317 $23,557 $17,593 $14,945 $12,430 $109,319
Bulk Servicing Acquisitions $345 $341 $581 $1,845 $144 $1,054 $3,706 $3,123 $2,349 $1,122 $1,563 $1,634 $4,187 $17,684
Portfolio Delinquency - CHL (5) 3.78% 3.77% 3.81% 3.54% 3.90% 3.91% 3.71% 3.71% 3.20% 3.19% 3.49% 3.48% 3.51%
Foreclosures Pending - CHL (5) 0.46% 0.46% 0.45% 0.50% 0.43% 0.43% 0.43% 0.44% 0.42% 0.38% 0.36% 0.37% 0.37%
INSURANCE
- ---------
Net Premiums Earned:
Carrier $54 $55 $51 $59 $54 $51 $56 $52 $50 $50 $48 $51 $54 $361
Reinsurance 11 11 10 11 13 13 12 13 12 13 13 13 13 89
--------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- ----------
Total Net Premiums Earned $65 $66 $61 $70 $67 $64 $68 $65 $62 $63 $61 $64 $67 $450
========= ========= ========= ========= ========= ========= ========= ========= ========= ========= ========= ========= ========= ==========
CAPITAL MARKETS
- ---------------
Securities Trading Volume (6) $326,751 $255,513 $240,154 $208,429 $196,586 $179,390 $192,618 $221,082 $276,738 $274,862 $292,116 $314,599 $266,645 $1,838,660
BANKING
- -------
Assets Held by Treasury Bank
(in billions) $14.1 $15.1 $16.4 $17.1 $17.7 $19.4 $20.3 $21.8 $23.7 $24.9 $25.6 $27.2 $28.6
GLOBAL OPERATIONS
- -----------------
Global Home Loans Subservicing
Volume (in billions) $95 $93 $98 $100 $103 $106 $109 $112 $111 $108 $111 $110 $110
Workforce Head Count: (7)
- -------------------------
Loan Originations 20,903 20,447 19,251 18,968 18,812 18,897 18,989 19,364 20,529 21,696 22,400 23,035 23,114
Loan Servicing 6,003 6,002 6,111 6,087 6,098 6,069 6,017 5,870 5,802 5,828 5,864 5,908 5,910
Loan Closing Services 1,115 1,065 956 955 952 931 941 952 926 938 993 1,019 1,049
Insurance 1,819 1,851 1,904 1,882 1,856 1,823 1,781 1,768 1,762 1,809 1,822 1,826 1,854
Capital Markets 429 440 452 470 476 477 484 491 494 513 517 529 540
Global Operations 1,898 1,897 1,962 1,965 1,997 1,981 1,899 1,948 1,993 1,961 1,965 1,955 1,929
Banking 876 808 804 787 810 813 803 823 849 888 956 1,003 1,015
Corporate Overhead & Other 3,270 3,238 3,309 3,282 3,282 3,307 3,347 3,366 3,389 3,441 3,529 3,660 3,814
--------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- ---------
Total Workforce Head Count 36,313 35,748 34,749 34,396 34,283 34,298 34,261 34,582 35,744 37,074 38,046 38,935 39,225
========= ========= ========= ========= ========= ========= ========= ========= ========= ========= ========= ========= =========
Period-end Rates
- ----------------
10-Year U.S. Treasury Yield 4.476% 4.458% 3.939% 4.301% 4.322% 4.261% 4.138% 3.984% 3.840% 4.499% 4.655% 4.610% 4.477%
FNMA 30-Year Fixed Rate MBS Coupon 5.722% 5.670% 5.012% 5.335% 5.410% 5.276% 5.192% 5.001% 4.937% 5.592% 5.752% 5.589% 5.484%
| (3) | Includes warehouse loans and loans under subservicing agreements for other clients. |
| (4) | Subservicing volume for other clients. |
| (5) | Expressed as a percentage of the total number of loans serviced, excluding subserviced loans and portfolios purchased at a discount due to their non-performing status. |
| (6) | Includes trades with Mortgage Banking Division. |
| (7) | Workforce Head Count includes full-time employees, contract, and temporary help. |
