Fitch Ratings hired Vincent Matsui as a senior director in its CDO asset manager ratings group. In his new position, Matsui reports to Senior Director Said Rafat, who heads Fitch's CDO asset manager rating group. Prior to Fitch, Matsui worked at Swiss Re, where he worked in the structured credit underwriting group.
Sallie Mae named Michael Fancher and Michael Taylor regional account executives for Eastern Pennsylvania. Fancher served as assistant vice president for education lending at PNC Bank Education Lending. Taylor comes to Sallie Mae from Drexel University, where he most recently served as interim
director of financial aid for the College of Medicine.
The Bond Market Association and the Securities Industry Association jointly sent a letter to the Securities & Exchange Commission last week, requesting that the Association of International Certified Public Accountants withdraw its draft white paper on due diligence discussions. The BMA and SIA believe that the AICPA's proposals, which limited the role of independent auditors in the due diligence process, may seriously harm investors. Specifically, the groups took issue with the AICPA's contention that advises auditors involved in due diligence discussions with underwriters refrain from answering certain questions about an securities issuer's financial statements, including whether or not the auditor suspects fraudulent activity, the BMA and SIA said in a joint statement.
LoanPerformance announced the release of the beta version of TrueStandings Servicing, a Web-based analysis and reporting solution for mortgage servicers. TrueStandings provides instant access to delinquency, prepayment and loan characteristics on more than 40 million active mortgage loans and offers additional access to a historical database of more than 100 million loans. The beta phase of TrueStandings Servicing is expected to conclude in December with general availability for current and new LoanPerformance clients early in the first quarter of 2006. LoanPerformance is a unit of subsidiary of First American Real Estate Solutions.
The latest issue of the Federal Reserve Bank of Dallas' Southwest Economy, Assistant Vice President And Senior Economist Jeffery Gunther and Senior Economist And Policy Advisor Robert Moore find that in regions where housing prices have increased rapidly, more borrowers are choosing ARMs or other nontraditional mortgages at increasing rates. They theorize that "judging mortgage risk based on delinquency rates on traditional ARMs and nontraditional mortgages in areas of high home appreciation could be misleading because
borrowers who could not afford the sudden increase in mortgage payments could simply sell their homes for a profit rather than default on the loan." Problems could arise, however, if home prices and demand drop in these areas because homeowners involved in these riskier mortgages would be unable to get out of them as easily, the study summed. The full report is available at: www.dallasfed.org
Mortgage insurer MGIC reported net income for the quarter increased 6.2% and that net income for the first nine months of 2005 was $498.8 million, up 19.1%, compared with $418.7 million for the same period last year. Total revenues for the third quarter were $375.7 million, down 3.9% from $391 million in 3Q04. New insurance written in the third quarter was $18.1 billion, compared to $18 billion in 3Q04. New insurance written for the quarter included $6.8 billion of bulk business compared to $6 billion in the same period last year. New insurance written for the first nine months of 2005 was $46.2 billion compared to $47.1 billion for the same period in 2004, including $15.5 billion of bulk business compared to $11 billion in the first nine months of 2004.
Harley-Davidson reported third quarter operating income of $47.6 million, down 5% from $50.1 million one year ago, driven primarily by a lower securitization gain versus 3Q04. Its $650 million third quarter securitization resulted in a $9.2 million gain, $4.6 million less than the gain in 3Q04. Harley-Davidson expects its 4Q04 securitization gains in the 1% to 1.4% range. Credit losses on a managed portfolio basis increased during the first nine months of 2005 to 0.97 percent from 0.69 percent in 2004, due to lower recovery rates and a higher incidence of loss.
Mortgage banking production profits dropped significantly to $657 per loan in 2004 from $1,272 per loan in 2003, according to the Mortgage Bankers Association twenty seventh annual cost study. With volume decreasing last year, per-loan operations costs rose and were only partly offset by rises in secondary marketing income. The average mortgage lender posted a pre-tax financial income of $23 million in 2004,dropping from the previous three years. The MBA also disclosed that the biggest bottom line contributor was net secondary marketing income, which average $1,661 per loan last year. The study is a series of reports on the income and expenses related to the origination and servicing of one- to four-unit residential mortgage loans.
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