Countrywide Financial, the largest U.S. mortgage lender, said Thursday it has lined up $12 billion of financing to help weather a housing slowdown that will lead to widespread layoffs.
Shares of Countrywide rose as as much as 14.38 percent in late Thursday afternoon trade on the New York Stock Exchange -- their biggest one-day gain in more than seven years.
The company said it recently lined up the secured financing through new or existing credit facilities. On Aug. 16, it had drawn down $11.5 billion from credit lines because it was unable to sell short-term debt to fund regular operations.
Calabasas, Calif.-based Countrywide also said it had funded $34.4 billion of mortgage loans in August, the fewest this year and down 17.3 percent from a year earlier, as it tightened lending standards. Daily applications fell 11.8 percent to $2.33 billion. Countrywide's pipeline of mortgages being processed fell 16.8 percent from July to $51.8 billion.
Countrywide's success in finding new sources of capital "should substantially address funding concerns," Credit Suisse analyst Moshe Orenbuch wrote. "As origination volumes and mortgage pipeline decline over the coming months, we expect the stress on its funding needs should subside significantly."