LenderNews by Rob Chrisman
  • Follow Us:

Dec. 12: Lenders seeking sellers, AE jobs; upcoming events; mortgage & bank M&A announcements; MBS issuance rankings

December 12, 2017

Today I find myself in Florida spending time with American Bancshares. Did you know the area code for Cape Canaveral is 321…as in a countdown? 2017 is counting down. No one has a crystal ball, but the MBA thinks that residential volumes will be down 5% in 2018. Others think that is optimistic. Think you have a lot of planning to do for 2018, and the future? Same thing with gasoline companies: In a world of driverless cars, how are they going to attract the car to their gas station, while the owner will want the least expensive petrol?
 
Employment, promotions, & business opportunities
 
“ARE YOU KIDDING ME?!?!” That’s precisely the response we get from every CEO, President, VP, Director, Manager and LO has said once they learned how much money they lost in the past 12 months. Here at Sales Boomerang we have literally found over $2.91B in lost loan volume for our clients in the past 9 months. Want to see how much you may have lost –  calculate it here? After you have stopped swearing at your screen schedule a free demo so we can help you win back all your millions… or billions.
 
Western Bancorp welcomes LaNell Silverstein as Regional Vice President, Sales for Southern California based in San Diego. With over 30 years in the industry, LaNell has held top sales executive positions improving process efficiency and increasing market share and is recognized as a visionary, solution-oriented leader. She’s built effective sales organizations utilizing her professional development and coaching skills and ensures cohesiveness with Operations through ongoing training. LaNell is looking for Senior Account Executives throughout Southern California so contact her (619-997-2249).
 
Waterstone Mortgage Corporation, a national bank-owned mortgage lender headquartered in Pewaukee, Wisconsin, is looking to acquire small to mid-sized traditional retail, purchase-focused mortgage companies nationwide. “Today’s tighter margins and increasingly complex regulatory environment are putting many small to mid-sized mortgage companies on the lookout for ways to expand their business, including strategic acquisitions to create additional synergies. Waterstone Mortgage has the strength and stability that mortgage executives are seeking when considering a sale of their retail business. The lender is a wholly-owned subsidiary of WaterStone Bank SSB (NASDAQ:WSBF), which has assets of more than $1.8 billion. As a Fannie Mae, Freddie Mac, and Ginnie Mae-approved lender, the company offers a broad range of products including FHA, VA, USDA, and conventional loans, one-time close construction financing, bank portfolio lending products, jumbo products and condo financing. It has done $2.5+ billion in origination volume this year, 90% of which comes from purchase mortgage loans. For more information, visit info.waterstonemortgge.com/acquisitions.”
 
As we approach the holiday season it’s a natural time to evaluate your work today and how you can build on success for 2018. One area that many lending teams can improve is technology in their process, specifically task management, document collection, and borrower communication. Digital solutions like Maxwell help lending teams become more productive while at the same time, provide a fantastic borrower experience. One feature we hear a lot about is their FileFetch technology that automates borrower document collection by linking to thousands of financial institutions to automatically pull in actual bank statements, mortgage statements, paystubs, and full tax returns. This along with a secure digital portal for customizable applications, task management, easier communication, and multiple API integrations provides an easily implementable and impactful digital solution to your organization. Currently, lending teams using FileFetch can collect borrower docs 73% faster. Visit Maxwell to Learn More and Request a Demo today.
 
Mergers & Acquisitions
 
My guess is that we’ll see a flurry of these in the coming months.
 
“STRATMOR is pleased to report that Wintrust Mortgage, a bank-owned lender based in Rosemont (IL), has negotiated terms to acquire iFreedom Direct, dba Veterans First Mortgage, subject to final due diligence, execution of a definitive agreement and mortgage regulatory approval. Veterans First is a Consumer Direct lender based in Salt Lake City with a second Call Center in San Diego. Founded over 30 years ago by Kevin Gates, his Company has developed a unique business model concentrating on VA purchase originations. Veteran First annual production volume has averaged $1 billion. Over the last several years, Veteran First’s purchase business share has exceeded 85%. Given that Consumer Direct lenders typically originate the great majority of their volume in refinance business, Veterans First is among the industry leaders in successfully penetrating the purchase marketplace. This outstanding accomplishment reflects a sophisticated marketing strategy and lead generation capability.
 
“For Wintrust Mortgage, this acquisition will bring several key strategic benefits, including an enhancement of its Consumer Direct channel performance and increase in its Government lending share. As part of this transaction, Wintrust also intends to purchase $1.4 billion of Government servicing. As a bank-owned lender, Wintrust will provide certain impactful efficiencies and acquisition synergies to the Veterans First operating platform.
 
“The STRATMOR Group served as Wintrust’s transaction advisor and helped identify the Veterans First opportunity. Wintrust Mortgage has established a history of growth via successful acquisitions and this experience was an important factor in Veterans First’s decision to pursue this deal. Contact STRATMOR Senior Partner Jeff Babcock if you are interested in discussing M&A market conditions.”
 
From Louisiana comes news that Public Service Mortgage Inc. and Prestige Mortgage Lending LLC will be merging their business operations on January 1, 2018, and will be using the trade name Endurance Mortgage.
 
Announcements from the banking sector have been heating up – a year-end push that will also be seen in residential lenders? Florida’s City National Bank ($6.5 billion in assets), a subsidiary of Banco de Credito e Inversiones SA ($51B, Chile), will acquire TotalBank ($3.1 billion, FL), a subsidiary of Banco Santander SA ($1.3T, Spain). In Michigan Independent Bank ($2.8B) will acquire Traverse City State Bank ($350mm) for about $63.2mm in stock (100%) or about 2.06x tangible book value. In Texas Independent Bank ($8.9B) will acquire Integrity Bank ($805mm) for about $164.3mm in cash (19%) and stock (81%). PNC Bank (PA) will acquire financial advisory and investor relations firm The Trout Group (NY).
 
In the Sunshine State Florida Community Bank ($10B) will acquire Floridian Community Bank ($545mm) for about $88.1mm in stock (100%) or about 1.72x tangible book. In Illinois Byline Bank ($3.3B) will acquire First Bank & Trust ($1.1B) for about $169mm in cash (17%) and stock (83%) or about 1.7x tangible book. In M&A news, Community Bank ($908mm, PA) will acquire Progressive Bank ($356mm, WV) for about $49mm in cash (20%) and stock (80%). Ameris Bank ($7.7B, GA) will acquire Atlantic Coast Bank ($922mm, FL) for about $145mm in cash (15%) and stock (85%) or about 1.60x tangible book. In the Peachtree State Georgia’s Own Credit Union ($2.3B) will acquire State Bank of Georgia ($96mm). For those playing along at home, this is the 5th acquisition this year by a credit union of a bank.
 
Upcoming events
 
For Fannie the new Demographic Information Addendum to the 1003 loan application will be required on all loan application effective January 1, 2018. This change affects brokers, non-delegated correspondents and correspondent lenders. The wholesale division of Finance of America Mortgage is hosting a webinar on this, led by Ginger Bell, Education Specialist at Go2Training tomorrow, December 13 at 11AM PT and will cover, “What is the Government Monitoring Information?” “Who Collects the Information?” “What is contained in the new Demographic Information Addendum?” Details about the 15 new "Disaggregated" GMI Options and three new free form fields, where to find the new Addendum, and how to complete the Addendum via telephone, fax or mail, email or internet, or face to face (including electronic applications taken with a video component). If you take loan applications, you won’t want to miss this webinar! Register online here.
 
On Thursday the 14th, from 12-1PM PT, I will discuss how things are looking for 2018 in this exclusive Vantage Production webinar. Moderated by Vantage’s EVP Todd Ballenger, we’ll discuss the Trump Era—one year in and what it means for the industry, how the Fed closed the books on 2017, today’s low-down on the digital mortgage movement, and housing market success and swings.
 
ReverseVision: User Con 2018 is scheduled for February 6-8 in San Diego, and features influential speakers, meaningful sales tools, strategic sales topics and resort-paced networking. Make a meaningful investment in your success by joining your peers and big speakers in the industry.
 
National MI is offering two upcoming webinars. “Strategies to Get Referrals from Millennial Realtors” on 1/17. “Millennial Realtors are key to accessing the Millennial homebuyer market…Kristin Messerli of Cultural Outreach will detail what Millennial Realtors value in lender relationships, and how to find and connect with Millennial real estate referral partners.” And Self-Employed Borrower on 1/18. “Self-employed borrowers represent a significant opportunity in today’s marketplace, but require prudent review and careful analysis to recognize risk in underwriting these types of borrowers. In this 2-hour session led by Marianne Collins of Diehl Mortgage Training and Compliance, participants will gain an understanding of the process of analysis, Fannie Mae and Freddie Mac requirements, and how to review tax returns.”
 
Capital markets
 
Thomson Reuters has aggregated Originator Rankings from Agency MBS Issuance to provide an early peak at 2017 YTD rankings (thru November issuance). YTD, Wells Fargo takes the #1 spot at $159B, followed by Quicken Loans at $71.8B, Pennymac Loan Services at $64.5B, and JP Morgan Chase a $57B. While the Top 10 from 2016 all made the Top 10 in 2017 YTD, Ditech, and Fairway Independent made the Top 15 in 2017, pushing Bank of America and Stearns Lending to 16th and 17th.
 
Looking at ONLY Correspondent-Sourced issuance, the top ranked Agency Sellers YTD are Wells Fargo, Pennymac Loan Services, JP Morgan Chase (+2 Rank), Amerihome Mortgage, US Bank (-2 Rank), Freedom Mortgage (+1 Rank).  The Correspondent buyers with some of the largest increases in the ranking included Lakeview Loan Servicing at 12th (+7 Rank) and Texas Capital at 18th (+11 Rank).  The Top retail originators were led by Quicken Loans with nearly 11% of all retail issuance, followed by Wells Fargo, JP Morgan Chase, loandepot.com, and Fairway Independent (+5 Rank).    The Top issuers of Brokered loans YTD include United Shore at $21B, Caliber at $12.5B, Stearns Lending at $8B, Pennymac Loan Services at $7.2B (primarily acquired from wholesale correspondents) and loandepot.com at $6.5B.  
 
Can you guess which state/territory has the highest % of brokered loans? That would be the Virgin Islands with 68% of VI issuance sourced from brokers, followed by Hawaii (24.7%), California (20.3%), Utah (18%) and New York (14%). YTD, brokered loans accounted for 11.25% of all issuance, compared with 12.6% in 2016. Available FIRST to recipients of my daily email, you can access a complimentary 25 page Mortgage STATS report of 2017 rankings YTD, by visiting Thomson Reuters MBS Aggregations. Click the lower right pane to complete the form and download the rankings report.  
 
Can the combination of sustained real growth strength, firming inflation, and passage of a tax bill help steepen the curve and catalyze a reflation/rotation (out of growth/momentum and into value) trade? The yield curve flattened slightly as the spreads between short and long-term rates contracted by a couple of basis points. 
 
Yesterday the 10-year note began the week flat closing at a 2.39% yield. The session began with news of an explosion at the Port Authority Bus Terminal in midtown Manhattan which left four people with minor injuries, including the would-be suicide bomber. The afternoon saw two Treasury auctions with mixed results. And it seems that MBS trading volume was slightly below average – early Christmas?
 
Today we’ve had the release of the November NFIB Small Business Optimism Index, November Producer Price Index (+.4%, core +.3%, +3.1% year over year – stronger than expected); coming up are the Redbook Same-Store Sales Index and a $12 billion 30-year bond auction at 1PM ET. The Fed begins its final two-day policy meeting of the year with the market widely expecting an increase in the target fed funds rate from 1.25% to 1.50%. We start Tuesday with rates a shade higher versus Monday’s close, with the 10-year yielding 2.40% and agency MBS prices down/worse nearly .125 due to the strong PPI number.
 
 
An old Wild West fort is about to be attacked. The wily old general sends for his trusty Indian scout. "You must use all your thirty years of skill in trying to estimate the sort of army we are up against here."
The trusty Indian scout lies down and puts his ear to the ground. "Heap large war party," he says, "maybe three hundred braves, four chiefs, two on black stallions, two on white stallions. All have war paint. Many many guns. Medicine man also with them."
"Good grief!" exclaims the general. "You can tell all of that just by listening to the ground?"
"No," replies the Indian, "I can see under the gate."
 
 
Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you’re interested, visit my periodic blog at the STRATMOR Group web site. The current blog is, “Servicing: All It’s Cracked Up to Be?” If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what’s going on out there from the other readers.
Rob
 
(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. Currently there are over 300 mortgage professionals looking for operations, secondary and management roles. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2017 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)