Reuters
H&R Block shares tumble on mortgage woes
Friday August 25, 11:01 am ET
By Joseph A. Giannone
NEW YORK (Reuters) – Shares of H&R Block Inc. (NYSE:HRB – News) sank 11 percent on Friday as the largest U.S. tax preparer warned of losses at its struggling mortgage unit, and UBS downgraded the stock to “neutral.”
The company said it would take a charge of $61.3 million, or 19 cents a share, to reflect an increase in the number of its subprime mortgage customers falling behind on their loan payments.
H&R Block’s woes will likely extend to other subprime lenders, analysts said, as borrowers with less-than-stellar credit histories struggle to keep up their payments as rates rise.
