Shares in mortgage lender IndyMac Bancorp Inc. closed down more than 4 percent Wednesday after the company said its loan production in May fell 13 percent from the previous month, as the U.S. housing market continued to deteriorate.

The Pasadena-based lender wrote $2 billion in loans during the month, with 88 percent of the mortgages eligible for sale to government sponsored mortgage industry organizations Fannie Mae, Freddie Mac or Ginnie Mae. IndyMac was one of the country’s largest Alt-A lenders during the housing boom but has seen its business falter over the past four quarters.

However, there are indications that as home prices fall locally and nationwide mortgage volumes could pick up. The Mortgage Bankers Association said Wednesday that mortgage application volume rose nationwide by 10.9 percent last week.

Refinance application volume increased 8.4 percent during the week, while purchase application volume jumped 12.8 percent, according to the bankers association.

Shares in IndyMac closed down 4.4 percent to $1.72 Wednesday.