Impac Cancels Dividend

Their mostly Alt-A mortgages are defaulting in high enough amounts that REO got too high for comfort. Management decided to get more aggressive in unloading REO, which means taking losses to move homes. Losses means no dividends. Admitting the truth meant the stock was down 22%. No wonder everyone else is just sitting on their REO, too afraid to sell it at market rates and take the losses.

http://biz.yahoo.com/prnews/070626/latu178.html?.v=2

"Although we are seeing charge offs at levels higher than we anticipated, we are pleased to have reduced our exposure to future losses by auctioning REO's, especially as real estate values may deteriorate in the near future."

12/31/2003 1.90%
12/31/2004 1.74%
12/31/2005 3.12%
12/31/2006 6.24%

1/31/2006 3.86%
2/28/2006 3.42%
3/31/2006 3.39%
4/30/2006 3.45%
5/31/2006 3.59%
6/30/2006 4.16%
7/31/2006 4.38%
8/31/2006 4.58%
9/30/2006 5.01%
10/31/2006 4.68%
11/30/2006 5.44%
12/31/2006 6.24%
1/31/2007 6.80%
2/28/2007 6.30%
3/31/2007 6.50%

Auctioning off the REO keeps the % down but results in losses.

Thanks for the data. I think it might have something to do with the housing slump.