cut its dividend in half and fired 10% of its staff.
The Pasadena, Calif., mortgage lender plans to cut its quarterly payout to 25 cents a share, according to a letter to shareholders. The company paid a 50-cent dividend Thursday.
IndyMac also plans to eliminate 1,000 jobs over the next few months.
The news comes as the lender said it expects a third-quarter loss of as much as 50 cents a share, "driven mainly by the spread widening and a continued high level of credit costs," the letter said.
Lenders large and small have felt the pinch from a rise in loan delinquencies and defaults.
said it cut 900 jobs earlier this week, while
announced 2,000 layoffs.
"In our second quarter earnings release, we said that the second half of 2007 and 2008 would continue to be challenging for the mortgage and housing markets and for Indymac," CEO Michael Perry said in the letter. "In fact, the mortgage and housing markets are very difficult, and the private secondary markets have significantly worsened. The illiquidity in the secondary markets, and consequent significant and abrupt spread widening for all mortgage products except those saleable to the GSEs, have negatively impacted the profitability of our mortgage production division."
Perry said that while the markets remain challenging, he does expect the company to be "solidly profitable" in the fourth quarter and in 2008.
The stock was down 3 cents at midday after earlier falling as much as $1.61 to $20.05.