Magazine article American Banker

4Q Loss for CompuCredit

Magazine article American Banker

4Q Loss for CompuCredit

Article excerpt

Byline: Maria Aspan

CompuCredit Corp., which posted a fourth-quarter loss, said it is continuing to respond to a difficult credit environment by preserving capital, managing accounts, and reducing expenses.

After the market closed Thursday afternoon, the Atlanta specialty lender and marketer of subprime credit cards reported a loss of $26.9 million, or 57 cents a share, compared with a profit of $15.75 million, or 33 cents a share, a year earlier. Excluding discontinued operations, the profit for the fourth quarter of 2007 was $27.5 million, or 58 cents a share.

J. Paul Whitehead, CompuCredit's chief financial officer, said in a prerecorded conference call Thursday that it was no longer reporting separate results for continued and discontinued operations, "as we had effectively exited all operations marked as discontinued by the end of the third quarter of 2008."

For the second consecutive quarter, CompuCredit avoided taking analyst questions on its conference call. During the prerecorded remarks, executives briefly mentioned two disputes involving the company, one of which has been resolved.

In December, CompuCredit settled a lawsuit with the Federal Deposit Insurance Corp. by agreeing to pay $116 million and reform its marketing practices to subprime cardholders. (It sold its marketing unit to Selling Source LLC last month.)

David Hanna, CompuCredit's chief executive, said he was "very pleased" with the settlement. "While we believed that our marketing materials fully complied with applicable laws, we chose to settle to put a costly legal situation completely behind us. …

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