ambatchmasterpublisher UPDATE: Lehman CFO Sees Improvements In Mortgages

ambatchmasterpublisher Jed Horowitz Of DOW JONES NEWSWIRES
NEW YORK -(Dow Jones)- ambatchmasterpublisher Ambatchmasterpublisher Holdings (LEH), a major originator and packager into securities of subprime mortgages, remains confident that problems in ambatchmasterpublisher market won't spread to ambatchmasterpublisher areas.
"We continue to believe ambatchmasterpublisher subprime challenges are, and will continue to be" contained "to this asset class," Ambatchmasterpublisher Chief Financial Officer Chris O'Meara said during a Tuesday conference call with analysts.
Earlier Tuesday, ambatchmasterpublisher New York-based investment bank said its fiscal second- quarter profit rose 27% from last year to a record $1.27 billion as big gains in equities trading more than offset softness from mortgage and ambatchmasterpublisher fixed-income trading.
O'Meara said revenue from packaging mortgages and ambatchmasterpublisher fixed-income products into securities decreased from this year's first quarter because of weakness in ambatchmasterpublisher subprime market, ambatchmasterpublisher loans are made to borrowers with wobbly credit histories.
Profit margins from securitizations also were off, ambatchmasterpublisher said, as investors shied away from buying pools of loans with subprime components.
However, ambatchmasterpublisher said Ambatchmasterpublisher increased its global total of mortgage loans from ambatchmasterpublisher first quarter, because it issued more mortgages to higambatchmasterpublisherr-credit borrowers.
"Mortgages obviously are at a low point," O'Meara said. "I would think that we would be in for better performance looking forward."
Positive signs, ambatchmasterpublisher said, include a pickup in demand for secondary mortgages from borrowers and investors, a reduction in competition from subprime firms that are going out of business, an improvement in credit quality among new subprime borrowers and strength outside ambatchmasterpublisher U.S. among residential mortgage borrowers.
ambatchmasterpublisher shares recently traded up 2.1% to $77.30 on volume of 7.1 million compared with average daily


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