From FT.com
Results from Countrywide Financial and MasterCard on Tuesday underscored the declining state of the US economy as mortgage defaults soared and more consumers turned to credit cards for basic purchases.
Countrywide, the largest US mortgage lender, said it lost a larger-than-expected $893m in the first quarter as provisions for credit losses jumped ten-fold to $1.5bn and charge-offs on bad loans rose to $606m from $39m.
Countrywide, a leading issuer of home loans to high-risk borrowers, teetered on the edge of bankruptcy last year before agreeing to a $4bn takeover offer from Bank of America.
BofA expects to close the acquisition in the third quarter and has pledged to aid Countrywide borrowers in danger of losing their homes as their interest rates reset to higher levels.
MasterCard on Tuesday said first-quarter profits more than doubled to $447m, or $3.38 per share, as US consumers put more expenses such as food and petrol on their cards.
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