Losses, Lawsuits and Solvency
With earnings season in full force, losses continued to mount, more lawsuits were filed and executive appointments were announced. Meanwhile, other firms are acquiring or investing in mortgage-related companies as solvency is becoming a growing issue. A REIT has expanded its servicing capabilities with a recent asset acquisition.
Bob Caruso left his post overseeing Bank of America Corp.'s servicing operations to become an executive vice president of Lender Processing Services Inc., an announcement last week said.
Brooklyn Federal Bancorp Inc. said in a statement last week that its president, Richard A. Kielty, will also become chief executive officer on Jan. 2, 2009. He replaces retiring Angelo J. Di Lorenzo.
read full story
GSEs Overshadow Mortgage Sector
As the mortgage sector grapples with stormy financial markets, all eyes are on Fannie Mae and Freddie Mac -- which saw their shares traded at their lowest levels in more than 15 years. Meanwhile, two real estate investment trusts disclosed financial information.
REIT & Exec Shakeups
Two mortgage real estate investment trusts are teetering in the brink of insolvency, the president of a nonprime lender has been ousted and IndyMac is facing its fifth investor lawsuit since last month. But another REIT is optimistic after restructuring a repurchase agreement, while a servicing operation has successfully traded hands.
Acquisition, Collapse & Regulatory Actions
A California credit union collapsed and an Ohio bank expanded its mortgage operations with the acquisition of another bank. Dozens of other financial institutions are dealing with a host of legal and regulatory actions, while a hard-money wholesale lender is streamlining operations with the help of a third party. Three real estate invstement trusts also made announcements.
Acquisition Done, Merger On
A small mortgage company has been acquired by a big bank, while two small banks have agreed to merge. Other corporate activity includes a real estate investment trust struggling to generate earnings and a New York-based lender that said it has been approved to issue securities backed by loans insured by the Federal Housing Administration.
Banks In Play
As the bankruptcy of a bank-holding company enables the sale of its subsidiary, another bank is being acquired by a financial behemoth. A third bank is hoping a successful public offering will boost its capital. Meanwhile, a real estate investment trust has unloaded all of its repurchase agreement financing with non-related third parties.
1 Merging, 1 Unloading Assets, 1 May Fold
The current economic environment continues to take a toll on financial firms, with some raising capital to offset losses, others merging with healthier organizations and a real estate investment trust warning that it might not survive.
Corporate Ladders & Slides
IndyMac Bancorp Inc. is facing its third investor lawsuit in one week, while several other banks are facing orders from a federal banking regulator. Other recent corporate activity includes a triggering event for a real estate investment trust.
Mergers On, Off & Pending
Shareholders of a troubled real estate investment trust have authorized the issuance of 3.5 billion additional shares, while shareholders of the nation's biggest mortgage lender are being advised to approve the acquisition of the company. Other recent corporate activity in the mortgage sector included a government-sponsored enterprise downgrade, a new REIT president and a delay in a series of planned mortgage acquisitions.
Massive Loss at Thornburg
Thornburg Mortgage Inc. reported a massive quarterly loss and disclosed that it temporarily halted new loan originations recently. Shareholder equity has been wiped out.
