HOUSING SLOWDOWN COSTS JOBS COUNTRYWIDE TO CUT 2,500, MUM ON WHO'S TAKING HIT.

Byline: GREGORY J. WILCOX Staff Writer

CALABASAS -- In yet another sign of a slowing real-estate market, mortgage giant Countrywide Financial Corp. said Tuesday that it will cut 2,500 jobs nationwide, saying it needs to save $500 million a year.

The Calabasas-based company, which has about 55,000 employees and is the nation's largest home-loan originator, said the cuts will come from operational and corporate administrative staffers but remained vague about what parts of the country would take the biggest hit.

Despite a decline in interest rates during the quarter, real-estate financing stayed flat, Chairman and Chief Executive Officer Angelo R. Mozilo said. And the company expects home sales will continue to slow more than what is typical for the fourth quarter.

``In response to changing market conditions, management has initiated an expense and headcount reduction program,'' he said in a prepared statement.

``I don't think there has been any decision where the jobs will be cut at this point in time,'' company spokesman Rick Simon said. ``The analysis is still going on but ... it won't be all in California.''

However, an analyst who participated in the earnings conference call but asked not to be identified said he thinks most of the cuts will come in California.

In the past, the company has said future expansions would be out of state because of the high cost of doing business here.

Countrywide has about 18,000 employees in California, including Calabasas, Simi Valley, Agoura, Westlake Village, Thousand Oaks, West Hills, Warner Center, Irvine, Pasadena, Rosemead and Lancaster.

Out-of-state operations are in Tempe and Chandler, Ariz., Dallas-Fort Worth and Tampa, Fla., Simon said.

``When they do rehire -- they are growing and there will be an increase in production at some point -- those new hires will likely be in states with lower costs,'' he said.

Last month, sales of previously owned single-family homes in the San Fernando Valley plunged 31.1 percent from a year ago to 814 transactions, or 368 fewer, according to the Southland Regional Association of Realtors. The median price increased 0.8 percent, to $595,000, just $5,000 more than a year ago.

The percentage price increase was the smallest since a 3 percent dip in January 1997. And in the smaller condominium market, the median price fell 1.3 percent, to $380,000 -- the first price decline for that market in more than a decade.

Meanwhile Tuesday, Countrywide also announced that third-quarter profits jumped 2 percent from a year ago.

During the July-through-September period, earnings increased to $648 million, or $1.03 per share, from $634 million, also $1.03 per share based on how the figure is calculated, from a year ago.

Analysts, on average, were expecting a third-quarter net income of $1.08 per share, according to a Thomson Financial poll. Revenue increased 4 percent, to $2.82 billion.

The company also said Tuesday that it will pay Mozilo a base salary of $1.9 million through 2009, and he is expected to step down as CEO after Dec.31, 2009, but stay on as chairman through Dec. 31, 2011.

Mozilo will also receive stock appreciation rights and restricted stock with a target value of $10million, the company said in a filing with the Securities and Exchange Commission.

Also, for the first time in Countrywide's history, the Board of Directors has agreed to a stock buyback and authorized spending up to $2.5 billion on the undertaking. Companies typically buy back stock when they think it is undervalued.

Countrywide shares increased $1.62, or 4.6 percent, to $36.83, after the news.

The Associated Press contributed to this report.

greg.wilcox(at)dailynews.com

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