VALLEY LENDER'S SHARES TUMBLE; PACIFICAMERICA STOCK FALLS 33%.
Shares of PacificAmerica Money Center fell more than 33 percent Thursday with the company saying the plunge may have resulted from some investors selling at steep loses to satisfy margin calls.
The Woodland Hills-based company's stock closed Thursday at $5.125, down $2.625, as 874,500 shares changed hands, more than 33 times the daily average volume over the past six months.
PacificAmerica is a sub-prime lender of home mortgages and its stock has been falling in the past week along with that of other companies in the industry.
``Virtually everybody has taken a beating,'' said Charles J. Siegel, the company's chief financial officer. ``The whole market has fallen quite a bit in the last week. We believe the reason our price fell was (that) there were a lot of margin calls.''
Siegel said he did not know which of PacificAmerica's big shareholders had margined the stock.
Margin accounts allow customers to buy stock with money borrowed from the broker. A margin call demands that the customer deposit enough money or stock to bring the account up to its minimum maintenance requirements.
PacificAmerica said there was no material change in its loan pool performance through July 31 and that it anticipates an all-cash sale of about $137 million in loans during the third week of September.
The company still expects to report positive cash flow and earnings for the third quarter.
|Printer friendly Cite/link Email Feedback|
|Publication:||Daily News (Los Angeles, CA)|
|Date:||Sep 4, 1998|
|Previous Article:||ENCINO HOSPITAL NURSES WANT AUTHORIZATION FOR UNION VOTE.|
|Next Article:||INSURER TO CHANGE BOARD; AMERICAN INTERNATIONAL GETS CHAIRMANSHIP AT 20TH CENTURY.|