FBR Reports First-Quarter Loss, Revenue Drop
FBR Capital Markets' first-quarter loss widened to $16.2 million (27 cents a share) from $10.2 million (16 cents) in the comparable period a year earlier. Revenue fell by more than half, to $49.9 million from $104.1 million.
Revenue in its investment-banking unit took a tumble, falling to $7.9 million from $70 million.
The Arlington investment bank said that during the quarter, it sold the rest of its mortgage-backed securities, worth $454.3 million, and eliminated debt from its balance sheet. It also cut non-compensation expenses by 19 percent in the first quarter compared with 2008's fourth quarter through restructuring and cutting employees by 27 percent.
Despite the troubles in the economy, the company expressed optimism about the future.
"The equity capital markets environment remained extraordinarily challenging in the first quarter, and we expect this could continue to be the case throughout 2009. However, the expense reductions achieved over the last several quarters have dramatically improved our ability to return to profitability in advance of a full recovery in banking revenue," said chief executive Richard J. Hendrix.
FBR Capital Markets' earnings come a day after the company released its proxy statement, showing that Eric Billings, chief executive of Friedman, Billings, Ramsey Groupand non-executive chairman of FBR Capital Markets, brought home $13.8 million in 2008, more than triple what he was paid the previous year. Friedman, Billings, Ramsey Group is changing its name to Arlington Asset Investment Corp.
April 22, 2009; 9:03 AM ET
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