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COUNTRYWIDE FUNDING COMMERCIAL PAPER RATED 'F-1' AND MEDIUM TERM NOTES 'A-' BY FITCH -- FITCH FINANCIAL WIRE --

COUNTRYWIDE FUNDING COMMERCIAL PAPER RATED 'F-1' AND MEDIUM TERM NOTES
 'A-' BY FITCH -- FITCH FINANCIAL WIRE --
 NEW YORK, Aug. 6 /PRNewswire/ -- Countrywide Funding Corp.'s $500 million commercial paper program is rated 'F-1' and its medium term note program is rated 'A-' by Fitch. The ratings reflect the company's strong operating results, increased capital and solid liquidity in a cyclical industry. The outlook is stable.
 Countrywide more than doubled its servicing portfolio to $33.4 billion over the five quarters ended May 31, 1992. The company has aggressively increased its portfolio despite high prepayments through its well diversified origination sources. With an emphasis on advanced technology, Countrywide should readily absorb the servicing growth. Strong loan production resulted in reducing the weighted average coupon of its servicing portfolio to 8.9 percent, which should provide annuity income that will be less vulnerable to future interest rate changes. The larger portfolio and lower weighted average coupon should allow for more sustainable cash flow in varying interest rate environments. However, the company, with a much larger capital base, will be challenged once opportunities for growth subside.
 Countrywide Credit posted strong earnings of $29 million for the first quarter of fiscal 1993, (fiscal year ends Feb. 28) compared to $9.1 million for the same period a year earlier. Earnings were boosted by the high volume of loan originations and a much larger servicing portfolio.
 Cash flow was solid at $53.2 million reflecting $22.4 million of amortization of capitalized and purchased servicing rights for the first quarter of Fiscal 1993. Earnings have grown at a compound annual growth rate of approximately 44.5 percent over the past four years. Profit margins have widened to more than 20 percent as productivity and operating efficiencies increase with a larger servicing portfolio.
 Countrywide maintains a strong balance sheet. Equity increased to $582.9 million as of May 31, 1992 from $133.5 million as of Feb. 28, 1991, due principally to three common stock offerings. The increase in equity also included $71.1 million of retained earnings. Leverage remains conservative at less than four times equity and less than one times equity, excluding short-term warehouse borrowings. The funding base is diverse and commercial paper backup facilities are appropriate. By virtue of the cross-collateralization of the warehouse facility, commercial paper is likewise secured by mortgages.
 -0- 8/6/92
 /CONTACT: Teri L. Seelig, 212-908-0638, or Nancy E. Stroker, 212-908-0533, both of Fitch/ CO: Countrywide Funding Corp. ST: IN: FIN SU: RTG


SH -- NY042 -- 7515 08/06/92 10:32 EDT
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Date:Aug 6, 1992
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