Columbia Home Loans to close by Sept. 30
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- July
- 31
The parent company of Columbia Home Loans LLC in Valhalla, which lost $12.6 million in the first half of 2007 amid problems with its subprime mortgage portfolio, said it plans to close the operation by Sept. 30.
A “significant number� of workers were let go in early July, said Michael J. Fitzpatrick, chief financial officer of the parent, OceanFirst Financial Corp. of Toms River, N.J. OceanFirst said earlier this year it would close its subsidiary, which once employed about 125.
Columbia’s president, Robert M. Pardes, resigned and a number of staffers who concealed losses in the group’s subprime mortgages were dismissed, OceanFirst said.
About 41 percent of the $728.3 million in mortgages that Columbia originated last year for OceanFirst were considered subprime, that is, they were made to consumers with less-than-perfect credit histories. Because of early defaults by consumers, Columbia was forced to buy back a significant portion of its subprime portfolio from investors to whom it had sold the loans.
Columbia repurchased $13.9 million in subprime loans in the first quarter of 2007, but just $1 million in the second quarter, OceanFirst said.
A savings bank with assets of $2.06 billion, OceanFirst bought Columbia seven years ago. OceanFirst reported a $5.42 million loss in the first quarter largely as a result of Columbia’s problems, but said this week it had second-quarter profits of $277,000, or 2 cents a share.
This entry was posted
on Tuesday, July 31st, 2007 at 5:47 pm by Jerry Gleeson.
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