Capital One closes GreenPoint mortgage unit

News Type: Event — Seeded on Mon Aug 20, 2007 5:38 PM EDT

Article Source: CNN

business, economy, money, credit, banks, psychology, mortgages, lending, sub-prime, bank-run

Capital One Financial Corp. said on Monday it would stop making new mortgages through brokers, citing a weaker profit outlook for that business amid current mortgage market difficulties.

Shares sank 3.6 percent in after hours trading on the New York Stock Exchange Monday.

Capital One (down $2.03 to $66.72, Charts, Fortune 500) said it expects after-tax charges from the closure of its GreenPoint mortgage unit of about $860 million, or $2.15 a share. Most of the charges will be taken in 2007. With these charges, full-year earnings will be about $5.00 a share.

The credit card and banking company said it expects to continue to make home loans in its bank branches, where it has more control of the underwriting process.

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Capital One closes GreenPoint mortgage unit

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