Servicing

Colonial Savings FA, Fort Worth, Texas, has become the 27th company to be inducted into Freddie Mac's Hall of Fame for achieving Tier One servicing status four years in a row, according to Colonial.The Tier One designation is given to servicers whose management of performing and nonperforming loans is deemed superior for two or more quarters in a given year. Freddie Mac ranks servicers in four tiers based on their investor reporting and default management. Colonial Savings can be found online at http://www.colonialsavings.com.

Imperial Capital Bank has received a CPS3 Small Loan rating from Fitch Ratings for primary servicing of commercial mortgage-backed securities, the first such rating given out by the rating agency.Fitch said the rating reflects ICB's experienced servicing management staff and its longtime experience as a servicer of small-balance commercial mortgage loans. However, Fitch also noted that ICB has not yet acted as a CMBS primary servicer and has no CMBS reporting experience. ICB is a California state-chartered commercial bank based in La Jolla. As of March 31, ICB serviced 1,493 commercial real estate loans with a cumulative balance of $1.4 billion. Fitch can be found online at http://www.fitchratings.com.

Fidelity National Financial Inc., Jacksonville, Fla., has announced a filing with the Securities and Exchange Commission relating to a proposed spinoff of its noninsurance operations into a separately traded public company.The new company, Fidelity National Information Services Inc., would issue common stock in an initial public offering. FNF said it plans to later distribute all its ownership interest in the new company in a tax-free spinoff through a special dividend to FNF common stockholders. FNF chairman and chief executive officer William P. Foley II said the spinoff will allow FNF to better position its financial institution processing, outsourcing, and real estate information businesses and "provide a separate, publicly traded currency that can be used in its business, including helping to finance future acquisitions." FNF will focus on title insurance and its other specialty insurance businesses, he said. The new company will consist of three main segments: Financial Institution Software and Services, including FNF's mortgage processing business; Lender Outsourcing Solutions; and Information Products and Services. Mr. Foley will become chairman and CEO of the new company. He will remain chairman of FNF, and Randy Quirk, now president, will assume the role of CEO. FNF can be found online at http://www.fnf.com.

Freddie Mac has reported that its total mortgage portfolio, which includes guaranteed mortgage-backed securities as well as its retained loans, contracted by 2% in April after eight straight months of growth.Freddie Mac said its retained portfolio fell at an annualized rate of 7.8% in April, while issuance of participation certificates decreased at a 4.9% rate. Structured securitizations increased, however. Freddie Mac's duration gap, an interest-rate risk management measure, remained at zero in April, unchanged from March. The single-family delinquency rate declined slightly to 25 basis points. Freddie Mac can be found on the Web at http://www.freddiemac.com.

Meanwhile, Foreclosures.com also forecast that rising interest rates will "spark a surge in Las Vegas foreclosure activity later this year."The company said the rising rates will "cool the very hot Clark County" rate of home price appreciation. "Foreclosures are a lagging indicator," said Alexis McGee, president of Foreclosures.com. "Although rates have been rising for seven consecutive weeks, we won't see the impact on homeowners for another four to six months."

The widespread use of adjustable-rate mortgages by California homebuyers in 2003 could lead to a rise in defaults later this year as interest rates rise, according to Foreclosures.com, a Fair Oaks, Calif.-based investment advisory firm specializing in distressed property.Company president Alexis McGee said the San Francisco Bay area and Orange County are the most vulnerable, as 65% of buyers in the Bay area and 67% in Orange County used ARMs last year to qualify for more expensive homes. Over 15,000 homes in California entered the foreclosure process in both the fourth and the first quarters, she said. "With two consecutive quarters of flat foreclosure activity, we can say that defaults returned to their baseline after victims of the 2001 recession were washed out of the system," Ms. McGee said. "Now, we expect defaults to start rising again as steady rate increases put adjustable-rate mortgage borrowers at risk." The investment advisory firm can be found on the Web at http://www.foreclosures.com.

Class BF of Long Beach Mortgage Loan Trust series 2000-LB1, group 1, has been downgraded from BBB to BB-minus and removed from Rating Watch Negative by Fitch Ratings.In addition, Fitch affirmed the ratings on 13 classes in two Long Beach residential mortgage-backed securities deals. The downgrade was attributed to high loss levels and depletion of overcollateralization. Fitch can be found on the Web at http://www.fitchratings.com.

Two certificates from a series of Bear Stearns asset-backed securities issued in 2001 have been placed under review for possible downgrade by Moody's Investors Service.The deal, Bear Stearns Home Loan Owner Trust 2001-A Home Loan-Backed Notes, Series 2001-A, is backed by high-loan-to-value junior-lien home equity and home improvement loans originated by Conseco Finance Corp. Classes M-2 and B, the two most subordinate fixed-rate certificates, were placed on review for possible downgrade "because existing credit enhancement levels may be low given the current projected losses on the underlying pools," Moody's said. The transaction has taken "significant losses," and the most subordinate tranche has begun taking writedowns, the rating agency said. Moody's can be found online at http://www.moodys.com.

The board of directors of The First American Corp., Santa Ana, Calif., has authorized the repurchase of up to 100 million shares of the company's common stock. The purchase of shares will be made in open-market transactions from time to time, the company said. "The current market price of our stock does not begin to reflect out success in transforming First American into a diversified provider of data and data-related products and services," said Parker S. Kennedy, chairman and chief executive officer of First American. "Given our current stock price and growth prospects, we believe a repurchase of our shares represents an excellent investment opportunity." Title insurance, mortgage information, and property information are among the company's primary businesses. First American can be found online at http://www.firstam.com.

Class B of First Union Home Equity Loan Series 1997-2 has been downgraded from BB-minus to CCC by Fitch Ratings.The rating action was attributed to the poor performance of the underlying collateral in the deal. Losses have been higher than expected and have resulted in the depletion of overcollateralization, Fitch said. The rating agency can be found online at http://www.fitchratings.com.