Out On A Golden Limb
Golden West Financial, which is most commonly know by the World Savings subsidiary, has first quarter numbers out. The mortgage firm couldn't be more leveraged. "Our loan portfolio increased to $107 billion, up 29% from $83 billion at March 31, 2004."
A staggering 99% of those loans are adjustable rate mortgages and the number of those that are refinacing is up to 78%, from 72% a year ago. Churn, baby, churn.
In addition to being vastly overweight in California, the spread between cost of funds and the rate it can charge is narrowing. From 2.92% a year ago to 2.4% now; that's almost an 18% decrease!