Mortgage Rates Falling Faster Than Cost Of Funds At Thrifts

Washington Mutual, Golden West shares fall
By MortgageDaily.com Staff
11/2/2001

Shares of Washington Mutual (NYSE: WM) fell more than five percent Thursday as investors worried that the Treasury Department's decision to suspend issuance of 30-year bonds might cause mortgage rates to decline faster than the borrowing costs of thrifts, according to Dow Jones Newswires (DJ).

Shares of Golden West Financial Corp. (NYSE: GDW), parent of World Savings, were down 2.76 percent.

Harry Milling, an analyst with Morningstar Inc., reportedly said that Washington Mutual saw the heaviest trading and one of the steepest drops because it is "the largest mortgage originator in the nation."

However, DJ reported that during the day UBS Warburg upgraded the thrift sector to "strong buy" during the day, and said the recent selloff puts these stocks at "historic low valuations," and "the bond rally and ensuing refinancing boom are only modest and temporary negatives."
MortgageDaily.com
Washington Mutual recently reported single family third quarter production of $43 billion, a more than 15% increase over the second quarter and a 200% improvement over the same quarter last year. Golden West recently announced that its 3rd quarter production was $5.6 billion, barely changed from last year's $5.5 billion.

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