Thornburg Mortgage’s shares plunge 51% on bankruptcy fear
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mortgage lenders, Thornburg Mortgage March 5th, 2008NEW YORK–Shares in jumbo mortgage lender Thornburg Mortgage Inc. fell 51 per cent yesterday after the company said a spike in lenders demanding more collateral or repayment could force it out of business.
Thornburg said it faces an additional $270 million (U.S.) in margin calls on top of the more than $300 million it was forced to meet last month. Margin calls force borrowers to repay loans or put up more collateral to secure them.
Santa Fe, N.M.-based Thornburg said it has not met the majority of the most recent calls, but is working to repay them by selling assets or through the raising of additional debt or capital. If Thornburg cannot meet the current calls, it said, the result could materially affect its ability to continue to operate.
Late yesterday, Thornburg said it completed a financing of about $1 billion in mortgages that will help improve its liquidity and provide long-term financing.
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