Friday, April 2, 2010

FDIC Finds Taker for $490 Million in Home Loans

The FDIC announced Thursday that Charlotte, North Carolina’s Roundpoint Mortgage Servicing Corporation placed the winning bid for an equity interest in a portfolio of 3,373 residential mortgage loans.

Collectively, the loans have an unpaid principal balance of $490.7 million. They were seized by the federal agency from 19 failed banks between August 2008 and March 2009.

According to the FDIC, approximately 51 percent of the loans are delinquent. Eighty percent of the collateral of the portfolio is located in Florida, Georgia and Arizona.

The transaction follows the FDIC’s traditional mode of disposition, in which the loans are transferred to a newly created limited liability company (LLC). With its winning bid, Roundpoint receives a 50 percent leveraged ownership stake in the LLC. The FDIC will hold the remaining 50 percent equity interest in its receivership capacity.

Roundpoint paid approximately $34.4 million in cash for its 50 percent equity stake in the LLC, which the FDIC said equates to an approximate value of 42 percent of the unpaid principal balance of the portfolio. As the LLC’s managing equity owner, Roundpoint will provide for the servicing of the loans.

The FDIC will share in the returns on the assets owned by the LLC, but the agency noted that the percentage of the LLC interests owned by Roundpoint and the FDIC may be adjusted based on the performance of the assets.

The sale was conducted through a competitive auction. Roundpoint beat out eight other bidders.

But auctions aren’t the only avenue the FDIC is traveling to put seized assets back into the private sector. Last month, the agency opted for a new tactic – packaging the loans and selling them to investors as securities on the secondary market. The FDIC has since completed three such transactions.

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Posted via email from Pilar Tobias

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