Ocwen Reports Worse-than-Expected Loss, Shares Tumble

Ocwen Financial swung to a much deeper-than-expected loss in its latest quarter, marking the third straight quarterly loss for the beleaguered mortgage-servicing company.

Shares tumbled 21% in after-hours trading. Through Wednesday's close, the stock had erased 64% of its value closing at $2.84 a share.

In the wake of regulatory problems, the West Palm Beach, Fla., company has pared down its mortgage-servicing rights and shifted its focus to mortgages not owned by government agencies, selling off assets and reducing its workforce.

Earlier this year, Ocwen paid $2 million to settle with the Securities and Exchange Commission over charges that it used flawed methodology to value mortgages and lacked proper accounting controls.

On Wednesday, the company attributed the steep quarterly loss to the impact of sales of agency mortgage servicing rights and to higher monitoring costs. Ocwen said it would continue to try to improve costs in order to help stabilize the business.

Over all, the company reported a quarterly loss of $111.3 million, or 90 cents a share. A year earlier, Ocwen posted a profit of $34.4 million, or 27 cents a share.

Revenue dropped 35% to $330.8 million. Analysts projected a loss of 39 cents a share and $346.3 million in sales, according to Thomson Reuters.

Write to Lisa Beilfuss at [e-mail]

(END) Dow Jones Newswires

April 27, 2016 18:05 ET (22:05 GMT)

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