Fitch Ratings has affirmed and removed from Rating Watch Negative Ocwen Financial Corp.'s residential primary servicer rating for subprime product, as well as the company's special servicer rating. The former rating was affirmed at RPS2, and the latter at RSS2.
Fitch says its rating actions reflect Ocwen's seasoned management team, focused operational and default management capabilities, as well as its proficient use of technology. The ratings also reflect Ocwen's long-term Issuer Default Rating of B+, which was removed from Rating Watch Negative and assigned a stable rating outlook by Fitch on June 3. The removal of the Negative Watch reflects Ocwen's improved financial flexibility.
Ocwen operates its servicing platform from sites in West Palm Beach and Orlando, Fla., and global servicing offices in Bangalore and Mumbai, India, as well as a new operating site in Montevideo, Uruguay. Ocwen continues to expand its offshore strategy with nearly 80% of its servicing operations managed from Bangalore, Mumbai and Montevideo, including customer-facing operations. All of the worldwide operations are wholly owned and operated by Ocwen.
As of April, Ocwen serviced a portfolio of over 298,000 loans with an unpaid principal balance of $39.9 billion. Since Fitch's prior review, Ocwen continued to make incremental enhancements across the servicing platform in expanded training hours for all staff and new hires, enhanced customer Web site and IVR technologies, highly adaptable and extensive scripting technology, and increased resolution opportunities.
Fitch believes Ocwen continues to operate a reliable servicing platform with the appropriate staff, internal control environment and technology to manage its servicing operations and ongoing initiatives. However, Fitch will continue to monitor Ocwen's large-scale offshore operations, as its ability to relocate its servicing functions back to the U.S. quickly is limited.
SOURCE: Fitch Ratings