Countrywide's loan fundings edge higher

Nation's largest home lender says December loan fundings increased 1%; stock bounces after tanking in previous session on bankruptcy rumors.

Countrywide Financial Corp., the nation's largest mortgage lender, said Wednesday its December loan fundings rose 1 percent from November and were ahead of internal forecasts.

The stock, which lost nearly a third of its value on Tuesday amid rumors of bankruptcy -- which the company strongly denied -- rose 13 percent in premarket trading.

Countrywide said it funded $24 billion in loans in December, giving it a total of $69 billion for the fourth quarter. Average daily mortgage applications in the month slipped from November, but Countrywide attributed that to a typical seasonal decline.

The company's banking operations had assets of $113 billion at the end of December, up from $83 billion at the end of November.

Countrywide also said it saw a slower rate of people paying off loans early, which made its servicing business more valuable. Servicers collect payments and manage loans for their owners.