Mortgage banker Residential Capital Corp. (ResCap) — whose parent recently completed a huge debt swap with bond holders — continued to bleed red ink in the fourth quarter, posting another huge loss as both its loan fundings and servicing rights suffered.

ResCap, which late last year closed its wholesale channel, funded $8.5 billion in home mortgages in the fourth quarter, a 59% decline from the fourth quarter of 2007. Its servicing portfolio fell to $393.8 billion at year-end 2008 from $453.3 a year earlier.

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