No dividend was declared on the Company's common stock. A combination of lower interest rates and modestly higher production volumes have moved us ahead of our internal earnings expectations for 2001 and 2002. Currently, the Company expects taxable income from operations to exhaust the NOL during the third quarter of 2001, resulting in a small dividend being declared for that period. The dividend for the fourth quarter of this year is expected to represent the Company's full taxable income for the period. Loan Production NovaStar Mortgage, the Company's wholesale mortgage banking unit, posted its eighth consecutive quarter of higher loan production.
Efficiency also continues to be a main focus for the mortgage lending unit.
Mortgage insurance dramatically reduces the Company's exposure to credit risk, thereby making future earnings considerably less volatile. Future charge offs are expected to decline even more significantly due to this purchase of insurance on the seasoned portfolio. The Company plans to continue acquiring mortgage insurance on substantially all future loan originations. The agreement matures March 31, 2002. NovaStar maintained substantial liquidity throughout the quarter and the Company remains confident that its existing funds are more than adequate to fuel its anticipated growth.