Thornburg Boosts Write-Down 58%


Thornburg Mortgage, a lender whose survival is in question, on Tuesday reported a $676.6 million write-down for adjustable-rate mortgages, 58 percent more than it had projected just four days ago.

Thornburg also reported that lenders had agreed not to make further margin calls through Monday, March 10.

On March 7, the Santa Fe, New Mexico-based company projected a $427.8 million write-down and restated 2007 results to reflect the charge. The lender said it increased the charge to comply with accounting rules, saying it may not be able to hold the affected home loans through maturity.

Thornburg provides loans to help people buy expensive homes. It has said it cannot meet its own lenders' demands for $610 million of cash or collateral.

These margin calls, together with falling mortgage prices and decreasing liquidity, have raised doubts about the lender's ability to stay in business. Analysts have said Thornburg might need to file for bankruptcy protection.

Thornburg's distress shows how the housing crisis has spread far beyond subprime borrowers and lenders to punish even lenders that focused on borrowers who were good credit risks.

In a statement, Chief Executive Larry Goldstone said Thornburg is talking with lenders to address the margin calls, avoid forced asset sales at large losses, and resume its lending business.

Thornburg shares closed at $1.07 on Monday on the New York Stock Exchange.