Mortgages -
Alliance & Leicester share price fall - 20/02/2008
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Alliance & Leicester’s share prices fall after warning that it expects earnings growth to lower this year, despite holding up the current shareholder dividend.
The mortgage lender issued the warning as they reported a 30 per cent drop in pre-tax profits for 2007 after writing down the value of its sub-prime mortgage assets.
Pre-tax profits dropped to £399 million, down from the £569 million made in 2006. Excluding its write-downs, A&L said operating profits rose 3pc to £602m.
The lender said: "We will focus our lending on maintaining strong asset quality and maximising revenues,” adding: "This is expected to result in mortgage balances reducing in 2008."
Recent troubles for the lender, which have seen results below those predicted by analysts, have been blamed on “unprecedented conditions in the financial markets since 2007.”
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