Highflying mortgage lender

Countrywide Financial


is denying a market rumor that the firm may have an accounting problem.

The California-based lender issued a press release at midday Thursday to debunk the rumor, which at one point had pushed the company's stock 7% lower.

"Management firmly believes that there is no basis whatsoever for these rumors and stands behind the integrity of its accounting practices and financial statements," the company said.

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Countrywide's stock recovered somewhat after the release, but in late afternoon trading the stock was still down $3, or 4%, at $71.44. For the year, Countrywide has been one of the top-performing financial stocks, rising nearly 40%.

It's unusual for companies to comment on market rumors. But Countrywide may have felt the need to do so in light of the accounting scandal now swirling around

Freddie Mac


-- the nation's second-biggest mortgage buyer. That's because Countrywide is one of the nation's biggest home lenders and maintains one of the largest mortgage-servicing portfolios.

The accounting controversy at Freddie is focusing on the firm's accounting treatment for derivatives -- sophisticated financial instruments that are used to hedge against interest rate fluctuation. In recent days, some have speculated that other mortgage firms that rely on derivatives as a hedging tool could become embroiled in a similar accounting controversy.