Finance

Bank of America Corp. sold defective residential mortgage loans to the GSEs that later defaulted, the U.S. government said in a $1 billion fraud lawsuit against the bank.

Ocwen Financial sent out a memo to employees early this afternoon informing them that the firm won the bid for Residential Capital Corp.

Prudential Financial said today it has closed the Dryden XXIV Senior Loan Fund, its most recent CLO, at $522.5 million.

Royal Bank of Scotland will pay $42 million to settle a probe by Nevada’s attorney general into its mortgage-purchase practices before the housing crisis.

The deal is an $835 million, single-borrower CMBS called BB-UBS Trust 2012-SHOW.

The securitization pipeline is filling up after Information Management Network's ABS East conference concluded yesterday with deals from Wyndham and BMO.

Mortgage application activity dropped 12% in the week ending Oct. 19 as mortgage rates inched higher.

Just two firms showed up at the auction: Nationstar and Ocwen Financial, which is working with Walter Investment, according to industry advisors tracking the deal.

JPMorgan has raised money for BlueMountain Capital Management's second CLO of the year.

SEC chairwoman Mary Schapiro criticized the prevailing pay model for ratings agencies on Tuesday.

With BofA out of the correspondent market for almost a year, and with other aggregators paying paltry sums for the ‘servicing released premium,’ many mid-sized FHA lenders want to become direct issuers.

Newtek Business Services, a nonbank financial firm that lends to small businesses, has assumed the servicing of a portfolio of loans originated by Aurora Bank FSB, which are in a securitization trust established in 2006.

It appears that other bidders will make a run at Residential Capital Corp. on Tuesday and Wednesday when the firm is auctioned off by a federal bankruptcy trustee.

Royal Bank of Canada agreed to buy Ally Financial's Canadian auto-finance and deposit business in a cash deal providing $4.1 billion in proceeds to Ally.

In Europe, efforts by out-of-money investors has thwarted recovery efforts by senior bondholders in troubled CMBS deals, according to a Fitch Ratings report published today.

Despite being the ABS market's current darling, a speaker at ABS East saw a potential bubble forming in the subprime auto segment.

Speakers harped on two topics in particular: the qualified residential mortgage rule and what they see as the unfair advantage that Fannie Mae and Freddie Mac still enjoy over the private-label RMBS market.

The fiscal cliff being faced by our government at the end of the year is probably the most chilling macro-economic risk, ABS East panelists said.

Finacity Corporation structured a $150 million securitization for the Manitowoc Company.

Fannie Mae president and CEO Timothy Mayopoulos said the GSE recognizes the outsized role it is playing in the mortgage market but is working on trying to attract more private capital to the business, he told attendees at the Mortgage Bankers Association’s annual convention in Chicago today.