Marathon Asset Management snagged Rick Smith and Steve Paton from bankrupt Mortgage Lenders Network USA to head up a new specialty loans servicing and loss mitigation business to be called Marix, the company announced. Smith was a senior vice president of loan administration, while Paton served as head of the Arizona operations. Marathon said it expects Marix to begin operating "in the near future." Market participants are expecting a handful of specialty loan servicing shops to crop up, as the subprime market continues to face downward pressure. MLN filed for Chapter 11 bankruptcy earlier this month.
ACA Capital Holdings is preparing to market its first European loan-backed CLO. The company is also ramping up five transactions, two of which it is currently marketing, along with a managed tranche program, said Alan Roseman, president and chief executive of ACA, speaking during the company's fourth-quarter earnings call. Roseman also said the company has equity exposure to CDOs backed by 2006 vintage subprime mortgages in four deals - primarily from two 2006 mezzanine deals where only $4.9 million in total were invested. ACA bought triple-B minus credit protection from the ABX.HE 06-2 and 06-1 series to hedge its exposure. Interestingly, the firm seems to be progressively limiting its equity exposure to mezzanine ABS CDOs, as it had $50.8 million in equity invested between two mezzanine ABS CDO deals issued in 2003. Those deals carry a 20% exposure to 2006 vintage HE ABS.