People
Bob Walton, head of agency security trading at Nomura Securities Co., left the firm last week. Walton had been at Nomura for four years as managing director. Other recent departures from the firm include Charles Smart and Steve Beck, co-heads of mortgage trading. Alex Noujaim took over the head of fixed income in April, and has indicated that Nomura will be focusing on fixed-income niche products.
Kurt Wright, Walter Higgins and Thomas Mattinson joined GMAC Commercial Mortgage Corp. on Sept. 1. The new executives will be responsible for raising capital and managing portfolios of commercial real estate debt including both whole loans and commercial MBS on behalf of institutional investors. The new group will target separate- account CMBS relationships as well as both commingled and separate-account whole-loan mandates. GMACCM also announced that it intends to form a new subsidiary, which has yet to be named, that will provide real estate investment management services to institutional investors.
Charles Smart, the former head of mortgage securities trading at Nomura Securities Inc. was hired as vice president of analytics at VisibleMarkets.com, an auction-based bond trading Web site. The dot-com also hired Peter Beebee as chief technology officer. Smart left Nomura in early August after trading mortgage derivatives and becoming head of mortgages at Nomura in 1998. He was with the company for five years.
Mark Mothner has joined Chase Manhattan as a managing director to head agency debt underwriting and trading. Mothner joins from Merrill Lynch, where he served as a director of government agency trading. In his new position he will report to Jonathan Gray, a managing director in the firm's U.S. securities division.
Peter Karches, president and chief operating officer of Morgan Stanley Dean Witter's institutional securities and investment banking group, is retiring from the firm after 25 years of service.
GSEs
Freddie Mac's Negotiated Transactions Department and GMAC Commercial Mortgage Corp. recently closed an $89.54 million Multifamily Gold PC swap that involved two mortgages backed by five New Jersey properties. All of the 1,968 units financed are affordable to low- and moderate- income families based on federal guidelines. When the transaction closed GMACCM placed the Freddie Mac Multifamily Gold PC into a commercial mortgage-backed security. And, according to GMACCM, the addition of the Freddie Mac Gold PC enabled the company to achieve lower subordination levels for the CMBS.
Fannie Mae has priced a $4.5 billion reopening of five-year Benchmark Notes due July 15, 2005. The 7.00% note, priced at 100.175, yields 6.708% at a spread of 76 basis points over the 6.750% Treasury due in May 2005. The reopening brings the issue to a total of $10 billion of notes outstanding. The joint lead managers are Credit Suisse First Boston Corp., J.P. Morgan Securities Inc., and Salomon Smith Barney Inc.
Freddie Mac wants to make first mortgages with 100% loan-to-values one of its standard products. The agency is hoping to inaugurate the product before the end of October and before the annual convention of the Mortgage Bankers Association.
Miscellaneous
It was reported last week that Wells Fargo & Co. agreed to buy most of General Electric Co.'s mortgage business and will collect its loan payments, becoming the biggest U.S. collector and processor of mortgage bills. The Wells Fargo Home Mortgage unit will administer $78.6 billion of loans for GE Capital Mortgage Services.
Allied Capital Corp. (ALLC) has filed to raise up to $310.5 million through the sale of a combination of common and preferred shares and debt. The Washington specialty finance company will use proceeds of any securities offerings to make investments in private and undervalued public companies and commercial mortgage-backed securities. It could also use proceeds to repay debt, which amounted to $726.4 million, and for other general corporate purposes. For the six months ended June 30, the company paid $75.5 million for CMBS with a face value of $143.4 million. The bonds have a weighted average yield to maturity of 14.7 percent, assuming a 1 percent loss rate on the collateral mortgages.
Last year, Allied paid $245.9 million for $507.9 million of bonds, which yield 14.6 percent. It now owns CMBS with a face value of $712.6 million. It has paid $356.6 million for the bonds.
On September 5, 2000, United Artists Theatre Company filed a "prearranged" Plan of Reorganization. Under the plan, outstanding debt will be converted into senior debt and equity; leases on 129 theaters (70 of which were closed over the past several months and 59 of which were subleased or assigned) will be rejected. A review of conduit transactions underwritten by Banc of America LLC (or its current or former affiliates) between 1996 and 1999 disclosed only one loan with significant United Artists exposure.
