IndyMac Revs Its Outlook

IndyMac(IMB Quote) shares spiked as much as 32% Thursday after the one-time Alt-A mortgage lender said that business is improving.

The Pasadena, Calif.-based lender said its loss for the first quarter will be roughly 50% to 65% less than in the fourth quarter, according to a filing with the Securities and Exchange Commission. Approximately 25% of the loss is coming from one-time severance and office closing costs, IndyMac said.

"Given the decline in our stock price, some people have questioned IndyMac's survivability in the current environment. I am here to tell you that I believe we have turned a corner and that our business is improving," CEO Mike Perry said in the filing. "Our forecasts show continued declines in credit costs and in our overall losses each quarter for the remainder of the year."

Last quarter, the struggling company recorded a loss of $509.1 million, or $6.43 a share. Analysts, on average, expect the lender to post a first-quarter loss of 98 cents a share.

IndyMac's shares were rising 67 cents to $3.92 on Thursday. Still, the stock is down more than 80% from a year earlier.

"Our stock remains under pressure because, as the last major independent home lender, we are at the center of the current storm in the housing and mortgage markets, and, to sustain sufficient capital levels to keep IndyMac Bank safe and sound through this crisis period, we have been raising capital every day through the [direct stock purchase plan], which itself puts pressure on our stock price," Perry added.