Countrywide Financial ( CFC) continued its steep ascent on Friday after executives sought to allay investor concern that the ailing mortgage lender still has liquidity problems. "Our backup liquidity framework was certainly very much tested in the third quarter," said David Sambol, Countrywide's COO, during a two-hour plus conference call to discuss third-quarter earnings. "While we certainly hope that we don't see another market stress ... like we did in the third quarter," Sambol said later in the call, "we are very much prepared ... should one come." After posting a third-quarter loss of $1.2 billion for the quarter, or $2.85 a share, the Calabasas, Calif.-based company's shares catapulted 30% on Friday. Despite the loss, Countrywide had said it planned to return to profitability in the fourth quarter and in 2008. Like other banks and lenders, the nation's largest lender has been plagued with writedowns on loans that the company could not sell as well as rising credit losses as home prices fell and borrower defaults rose. As the markets for mortgage-backed securities essentially froze up this past summer, Countrywide faced a liquidity crisis so large that many investors feared the company would go under. In August it was forced to draw down an $11.5 billion credit line. Later in the month it made a deal to sell Bank of America ( BAC) $2 billion worth of preferred stock.