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Countrywide says lending, borrowing ability sound
Tuesday November 27, 1:33 pm ET
By Jonathan Stempel

NEW YORK (Reuters) - Countrywide Financial Corp (NYSE:CFC - News), the largest U.S. mortgage lender, moved to reassure investors on Tuesday that it is not borrowing too much and will not be constrained in its ability to provide home loans

"We said it back in August, we said it in September, we said it last week, we'll say it until we turn blue in the face, but we have ample liquidity to fund our growth and operational needs," David Bigelow, managing director of investor relations, said at an FBR Capital Markets conference in New York.

Countrywide shares rose 27 cents, or 3.1 percent, to $8.91 in afternoon trading, only the second gain in the last two weeks. Prior to Tuesday, Countrywide shares had sunk 80 percent this year.

Countrywide, based in Calabasas, California, has faced heavy criticismover its lending practices as defaults mounted, leading to a $1.2 billion third-quarter loss.

Chief Executive Angelo Mozilo has said U.S. housing is in its worst slump since the Great Depression. The company's share price decline has resulted in a roughly $1 billion paper loss for Bank of America Corp (NYSE:BAC - News), the second-largest U.S. bank, on its $2 billion investment in the company in August.

Bigelow rejected criticism that Countrywide has threatened the soundness of the Federal Home Loan Bank system by borrowing excessively. He also said Countrywide does not expect issues affecting Freddie Mac (NYSE:FRE - News) and Fannie Mae (NYSE:FNM - News) to materially hurt its ability to make home loans.

In addition, Bigelow said Countrywide still plans to cut 10,000 to 12,000 jobs from July's level of 61,586 and said the number could be "a bit higher" depending on attrition.

full article http://biz.yahoo.com/rb/071127/countrywide_outlook.html?.v=1

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