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Merrill Lynch Home Loans Pulls Origination, Subservicing Business From PHH

PHH Corp. in April announced that one of its major clients, Merrill Lynch Home Loans, a division of Bank of America, had decided to move the origination of new applications for certain mortgage loan products to its internal operations effective April 25. This, in turn, resulted in PHH significantly reducing its volume forecast for the remainder of this year.

PHH reports that on an annualized basis, this change could represent a reduction of approximately 5% of its 2015 loan closing dollar volume.

What’s more, the firm says in a release that “there can be no assurances that the remaining Merrill Lynch origination activity with PHH will not also be subject to change during the remainder of 2016 or beyond.”

Merrill Lynch also plans to insource its subservicing portfolio, currently with PHH, before the end of this year. As of Dec. 31, 2015, Merrill Lynch’s subservicing portfolio with PHH accounted for approximately $40 billion in unpaid principal balance. That’s 32% of its subservicing portfolio and about 18% of its total servicing portfolio, according to the release.

“While we are disappointed with these changes, we intend to take appropriate measures to adjust our operations and incorporate these developments in our review of strategic options. We believe these decisions reflect the broader dynamics in our industry, including higher compliance and other costs associated with a more onerous regulatory environment,” says Glen A. Messina, president and CEO of PHH Corp., in a statement. “We remain focused on implementing the priorities we laid out for 2016 and the evaluation of all options, including capital structure and deployment alternatives, to maximize value for shareholders.”

As a result of these developments, PHH has withdrawn its previously disclosed earnings guidance for full-year 2016 and will not provide further earnings guidance until it completes a comprehensive review of its strategic options.

Meanwhile, Morgan Stanley Private Bank, which represented 20% of PHH’s 2015 loan closing dollar volume, has renewed its contract with PHH for origination services through Oct. 31, 2017. However, according to the release, Morgan Stanley will be re-assessing its arrangement with PHH for mortgage origination services upon the expiration of its contract.

 

Visionet Adds Bill McNamara As Chief Strategy Officer

Industry veteran Bill McNamara has joined Visionet Systems Inc., a Cranbury, N.J.-based provider of technology and technology-led business process outsourcing (BPO) services, as its chief strategy officer.

In this new role, McNamara will be directing the growth of Visionet’s mortgage technology solutions and business services and be responsible for the expansion of the company’s domestic and international processing centers.

According to Visionet, McNamara has an extensive career spanning over three decades in several financial services areas, including property casualty insurance, residential mortgage, title insurance, settlement services and property valuation. Most recently, McNamara held the position of president and CEO of two large national organizations in the title insurance and settlement service industry.

“Bill’s deep understanding of the mortgage business, prior experience and leadership will enable Visionet to understand its clients more thoroughly and to continue to improve the company’s technology-led BPO products and services,” says Arshad Masood, CEO of Visionet.

 

CFPB Promotes Five, Hires One For Executive Roles

The Consumer Financial Protection Bureau (CFPB) recently promoted five of its executives and hired another.

First, the CFPB hired Grady Hedgespeth as assistant director for the office of small business lending markets. Previously, Hedgespeth served as director of the office of economic opportunity for the U.S. Small Business Administration, where he started in 2007 as the director of the office of financial assistance.

Before working in government, Hedgespeth led two different national small business community development financial institution lenders and created several businesses focused on underserved markets at some of the nation’s largest banks, the bureau says in a release.

The CFPB has also appointed Elizabeth Ellis as deputy associate director for the external affairs division. Ellis previously served as the deputy assistant director for the office of financial institutions and business liaison at the CFPB. Before that, she worked as the senior advisor to the bureau’s chief of staff.

Prior to joining the CFPB, Ellis was a financial analyst on the Congressional Oversight Panel, where she evaluated the Troubled Asset Relief Program and reviewed the state of financial markets and the regulatory system. Before working in government, Ellis was a senior associate at PricewaterhouseCoopers in the banking and capital markets audit practice.

The bureau has also appointed Seth Frotman to serve as the new student loan ombudsman and assistant director for the office for students and young consumers. Previously, he served in the same positions on an acting basis.

Frotman originally joined the bureau as part of the treasury implementation team in early 2011 as senior advisor to Holly Petraeus, the assistant director for the office of servicemember affairs. He has also worked on the senate committee on health, education, labor and pensions and was the deputy chief of staff for U.S. Rep. Patrick Murphy. Before coming to Washington, he served as an assistant staff counsel for the New Jersey State Senate and clerked on the U.S. Court of Appeals for the Third Circuit.

The CFPB has also appointed Katherine Gillespie deputy associate director for the consumer education and engagement division. Previously, Gillespie served in the same position on an acting basis. Prior to that, she worked as senior counsel to the bureau’s deputy director and the associate director of the supervision, enforcement and fair lending division.

Gillespie originally joined the CFPB in 2011 as a senior counsel in the office of fair lending and equal opportunity. Prior to joining the bureau, she worked as a civil rights attorney at law firm Relman, Dane & Colfax, where she focused on litigating fair housing and other civil rights issues. Before that, Gillespie was an attorney at WilmerHale. She clerked for the chief judge of the U.S. Court of Appeals for the Ninth Circuit.

The bureau has also appointed Chris Johnson assistant director for the office of consumer response. Previously, Johnson served in the same position on an acting basis. Johnson joined the Office of Consumer Response in January 2011 as a member of the treasury implementation team. Within the office of consumer response, he has worked as the deputy assistant director, a section chief and a quality assurance manager.

Prior to joining the CFPB, Johnson was the director of service operations and customer care for Easterns Automotive Group, where he oversaw field service operations, as well as the company’s centralized complaint handling, customer feedback, regulatory response and service scheduling functions. In addition, he has served in various leadership roles in automotive retail, consumer credit card collections, project management and call center operations for CarMax Auto Superstores Inc., Circuit City Stores Inc. and First North American National Bank.

The bureau has also promoted John Schroeder to Midwest regional director for the office of supervision examinations. Previously, Schroeder served in the same position on an acting basis. He joined the CFPB in March 2013. Prior to becoming an acting regional director, he worked as the assistant regional director and as a field manager in the Midwest region.

Before joining the bureau, Schroeder spent more than two decades working for the Indiana Department of Financial Institutions, where he served as general counsel and deputy director of consumer credit, along with a number of other roles.

 

OCC Adds Grace Dailey, Grovetta Gardineer To Senior Executive Roles

Comptroller of the Currency Thomas J. Curry has announced that Grace Dailey is to be appointed senior deputy comptroller for bank supervision policy and chief national bank examiner and that Grovetta Gardineer will fill the newly created position of senior deputy comptroller for compliance and community affairs.

According to a release, Dailey will succeed Jennifer Kelly, who is retiring at the end of April after 37 years of service to the Office of the Comptroller of the Currency (OCC).

“Since joining the agency in 1983, Grace has honed her keen skill and sound judgment supervising banks of all sizes,” says Comptroller Curry. “She exemplifies what it is to be an OCC leader and understands the kind of policy and support our supervisory staff needs to keep national banks and federal savings associations safe and sound.”

In her new position, Dailey will direct the formulation of policies and procedures for supervising and examining national banks and federal savings associations. She will serve on the agency’s executive committee and committee on bank supervision.

Dailey previously served as a national bank examiner and assistant deputy comptroller in midsize and community bank supervision, examiner-in-charge of two of the nation’s largest banks, and deputy comptroller for large bank supervision.

According to Comptroller Curry, the OCC created the new senior deputy comptroller for compliance and community affairs position to address the fact that compliance risk management deficiencies pose safety and soundness risks.

“Accordingly, we need to focus on compliance as we focus on safety and soundness,” says Curry. “They are two sides of the same coin and require dedicated staff and infrastructure to ensure the appropriate balance.”

In this new role, Gardineer will serve as a member of the agency’s executive committee and committee on bank supervision, overseeing compliance exams of national banks and federal savings associations and managing the agency’s Community Affairs and Community Reinvestment Act programs. The release adds that Gardineer will retain her responsibilities for policy and examination procedures relating to consumer issues and anti-money laundering.

Gardineer, with more than 28 years of experience in bank supervision and regulation, previously worked for the Office of Thrift Supervision, where she served as the managing director for corporate and international activities. Before that, she was the managing director for supervision policy, where she handled capital policy, credit risk, trust operations, accounting policy and information technology risk.

 

Dimont, Phoenix ABS Announce Strategic Partnership

Dimont, the largest provider of specialty insurance and loan administration services to the residential and commercial financial industries, has formed a strategic partnership with New York City-based Phoenix ABS, a technology solution provider for residential mortgage-backed security and residential whole loan investors, as well as property preservation companies and lenders.

Phoenix ABS integrates valuation and diligence tools for the assets on which Dimont files hazard insurance claims. This includes survey information, property preservation photos, property maps and more.

Per the partnership, Dimont can now begin to file and adjust hazard claims for Phoenix ABS customers, as well as assist current property preservation companies interested in using Phoenix ABS tools, including its machine learning-based automated valuation model, to understand collateral, loan and portfolio value.

“Phoenix and Dimont are natural complements for mortgage investors,” says Guhan Kandasamy, head of product at Phoenix ABS. “Both unlock hidden value from different parts of the same portfolio.”

 

New CEO At Western Asset Mortgage Capital

Western Asset Mortgage Capital Corp. (WMC) recently announced that Gavin James will retire from his position as CEO of the company, which is externally managed by Western Asset Management Co., effective June 1, and that Jennifer Murphy will now serve as CEO.

“We are very grateful to Gavin James for leading WMC since its IPO in 2012,” says James W. Hirschmann, chairman of the board. “Gavin has been a valuable contributor, and he will be sorely missed. We congratulate him on his distinguished career and wish him all the best as he enters a new chapter in his life.”

Murphy was appointed CEO by WMC’s board of directors and will take over the role upon James’ departure. The board also plans to nominate her to become a member of the board in connection with the publication of WMC’s 2016 proxy statement.

“We are pleased to welcome Jennifer Murphy in her expanded role at Western Asset to become WMC’s new chief executive officer,” continued Hirschmann. “Jennifer has a strong track record in the investment management field and is well suited to lead WMC. Western Asset has already benefited from her talents and dedication as our chief operating officer and will reap new benefits from her service in this new role as chief executive officer of WMC.”

Murphy has 30 years of experience in the investment management industry. Prior to joining Western Asset in 2015, she served as chief administrative officer at Legg Mason Inc. She also served as CEO and president of its equity investment affiliate, Legg Mason Capital Management.

Loan Administration

Merrill Lynch Home Loans Pulls Origination, Subservicing Business From PHH

 

 

 

 

 

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