Fremont General Corp. intends to exit its subprime residential real estate lending business and is seeking a buyer for the unit, the Santa Monica based lender said Friday in a regulatory filing.

Fremont received a “proposed cease and desist order” from the Federal Deposit Insurance Corporation asking the company to make changes designed to restrict the level of lending in its sub-prime residential mortgage business. The company, which lost more than 30 percent of its share value this week, said the decision to sell was in light of recent legislative and regulatory events, as well as changing competitive dynamics in the sub-prime market. Subprime lenders nationwide have seen rising default rates as the housing market has cooled.

This announcement comes after the company postponed its fourth quarter and annual earnings report, giving no reason for the delay.

The company said in its Securities and Exchange Commission filing that its management and board of directors have entered into discussions with various parties for the sale of this business and has hired Credit Suisse Securities LLC to assist in the sale.

Fremont said it will continue to originate commercial real estate loans. The company said expects to file its Form 10-K by March 16.

Shares in Fremont closed down 39 cents, or 4.2 percent, to $8.71 Friday on the New York Stock Exchange. Shares fell another $1.51, or 17 percent, after the market closed.