H&R Block shares plunge on loss provision

08/25/06 - newratings.com

NEW YORK, August 25 (newratings.com) – Shares of H&R Block Inc (HRB) tumbled in Friday trading, after the company Thursday announced it would prepare a provision for losses on subprime home loans.

The Kansas City, Missouri-based company’s share price plummeted 8.69% to close at $20.81 on the NYSE on Friday. H&R Block said it is reserving $102.1 million, or 19¢ per share after taxes, in the first quarter for mortgage-loan losses. The company stated that investors purchasing its mortgages were selling the loans back. H&R Block said in a regulatory filing that it expects to set aside $46.1 million for loans sold in the quarter, and another $56 million for loans sold in previous quarters.