Countrywide Defends Liquidity

Countrywide Financial (CFC Quote) defended its financial health late Thursday, citing the "continuing adequacy of its funding liquidity and the strength of its financial condition."

The news came after the stock dropped sharply in afternoon trading, hitting a 52-week low at $25.40 before recovering some of its losses in late action. Earlier Thursday, mortgage insurer MBIA (MBI Quote) said on a conference call that three Countrywide deals hit "triggers" that protect MBIA against a rise in mortgage delinquencies and defaults.

Countrywide finished regular trading down 45 cents at $26.77.

"Countrywide has longstanding and time-tested funding liquidity contingency planning," said finance chief Eric P. Sieracki. "These planning protocols were designed to encompass a wide variety of conditions, including recent secondary market volatility. Our liquidity planning proved highly effective earlier during 2007 when market concerns first arose about subprime lending, and remains so today. We place major emphasis on the adequacy, reliability and diversity of our funding sources. It is important to note that short-term liquidity is used exclusively to fund our highest credit quality, most liquid assets. ...