Servicing

The American Stock Exchange has announced the commencement of trading in options on the stocks of Anworth Mortgage Asset Corp. and MFA Mortgage Investments Inc.The options on Anworth stock were slated to open with strike prices of 12.5-15.0-17.5 and position limits of 31,500 contracts, Amex reported. The specialist is Bowery Specialist Group LLC. Anworth invests in mortgage pass-through certificates, collateralized mortgage obligations, mortgage loans, and other mortgage assets. The options on MFA stock were slated to open with strike prices of 7.5-10.0-12.5 and position limits of 31,500 contracts, Amex said. The specialist is Highland Securities Corp. MFA is a mortgage real estate investment trust that invests chiefly in highly rated adjustable-rate mortgage securities. Amex can be found online at http://www.amex.com.

Abington Bancorp, Abington, Mass., has announced a major balance sheet restructuring program that includes the sale of $75 million of mortgage-backed securities.Abington said the restructuring is aimed at reducing unamortized premiums, improving earnings and operating ratios, strengthening capital, and reducing interest rate and price risk. Besides the sale of higher-risk MBS, the company said it will sell $22 million of smaller-denomination securities and liquidate short-term debt and a portion of its longer-term, high-cost Federal Home Loan Bank borrowings. "The elimination of higher-risk earning assets and repayment of some of our higher-cost borrowings is expected to improve our net interest income by over $1.5 million annually," said James P. McDonough, the company's president and chief executive officer. In May, Abington announced a revision of its 2002 financial results and a restatement of its 2001 results to correct certain accounting errors related to prepayments on MBS, among other things. Abington, the holding company for Abington Savings Bank, can be found online at http://www.abingtonsavings.com.

Mortgage lenders added 7,200 full-time employees to their payrolls in July even though mortgage rates began to climb during the month.Data released Friday by the U.S. Bureau of Labor Statistics show that employment in the mortgage banker/broker sector rose from 414,500 in June to 421,700 in July. (There is a one-month lag in mortgage employment data due to recent changes in the BLS employment report.) Next month's employment report is likely to show some slowdown in hiring in August, but lenders are still processing a huge number of loans, and some firms continue to hire loan officers to increase their market share. Over the past 12 months, employment in the mortgage industry has increased by nearly 20%, or 66,900 new hires. Meanwhile, the U.S. jobless recovery continued in August. The BLS reported that nonfarm payrolls declined by 93,000 in August even though the unemployment rate edged down to 6.1% from 6.2% in July. The BLS can be found online at http://stats.bls.gov.

The B-4 classes of ABN Amro (AMAC) mortgage pass-through certificates series 1999-1 and series 1999-5 have been placed on Rating Watch Negative by Fitch Ratings.The rating agency also upgraded eight classes in the two transactions and affirmed the ratings on two others. The Rating Watch placements were due to loss levels and high delinquencies relative to applicable credit support, Fitch said. The rating agency can be found online at http://www.fitchratings.com.

First American Real Estate Solutions, a joint venture 80% owned by the First American Corp., has reached an agreement to buy Transamerica's real estate tax service and flood hazard certification businesses for an undisclosed price.First American said terms of the transaction will be disclosed upon execution of the definitive agreements. The joint venture partner in FARES is Experian Information Solutions. The transaction will be funded from FARES's existing cash and proportional cash contributions from First American and Experian, First American said. Transamerica Finance Corp. is an indirect subsidiary of Aegon, one of the world's largest insurance firms. It is based in the Netherlands. FARES can be found online at http://www.firstamres.com.

The rating on class HI B-2 of Home Improvement & Home Equity Loan Trust 1997-C, a Conseco Finance Corp.-related transaction, has been lowered from CCC-minus to D by Standard & Poor's Ratings Services.S&P said Conseco Finance did not make any payments under a limited guarantee on the July 15 and Aug. 15 distribution dates, causing interest shortfalls on class HI B-2 that resulted in default. "These interest shortfalls were not made known until corrected monthly distribution reports were sent on Friday, Aug. 29, 2003," S&P said, citing an error in the reporting model used by the servicer, Green Tree Servicing LLC, as the cause of the delay. S&P can be found online at http://www.standardandpoors.com.

Rogers Townsend & Thomas PC, Columbia, S.C., has announced it that it is the only law firm in South Carolina to be named a designated counsel by both Fannie Mae and Freddie Mac.The firm said it has been selected to represent both government-sponsored enterprises in foreclosure and related proceedings in the state. The selection was made from numerous law firms vying to be one of two designated counsels in the state for each GSE, Rogers Townsend said. The law firm, which specializes in default services, real estate, and litigation, can be found on the Web at http://www.rtt-law.com.

Francis Creighton, a former legislative director for Rep. Steve Israel, D-N.Y., has been named director of government affairs at the Mortgage Bankers Association of America.The MBA said Mr. Creighton will be primarily responsible for lobbying the House of Representatives on key industry issues. Before his stint with Rep. Israel's office, Mr. Creighton was senior counsel for public affairs and manager of new business development at the GCI Group, New York. He has also worked at the U.S. Department of Labor and in the offices of former Rep. Sam Gejdenson, D-Conn., and the late Sen. Daniel Patrick Moynihan, D-N.Y. The MBA can be found online at http://www.mbaa.org.

The PMI Group Inc., Walnut Creek, Calif., has been given a rank of 4(Sell) by Zacks.com, the online unit of Zacks Investment Research Inc., Chicago.Stocks with this ranking should be sold or avoided for the next one to three months, Zacks said. In its comments about the mortgage insurer, Zacks noted that earnings estimates for this year and next are down 62 cents and 34 cents, respectively, from where they were at the end of May. In its results for the second quarter, PMI did not take any impairment related to the beleaguered Fairbanks Capital Corp., but the company did not rule out any future action. (PMI owns 57% of Fairbanks, a subprime mortgage servicer based in Salt Lake City that is under federal investigation for its servicing practices.) On the other hand, PMI is the largest stakeholder in the investor group buying Financial Guaranty Insurance Corp. from GE Capital. "As conditions improve, so too should PMI Group's results and earnings estimates," Zacks said. "For right now, though, it might be best to sit tight on a position in PMI Group until its earnings estimates gain more upside mobility." Zacks can be found online at http://www.zacks.com.

Fitch Ratings has announced the addition of the prime market sector to its Web-based RMBS Market Sector Performance Indices.The indices present mortgage delinquency statistics for the prime and subprime sectors by period of security issuance, and facilitates the comparison of performance over time, the rating agency said. The residential mortgage-backed securities indices include 60-day and 90-day delinquencies, foreclosures, real estate owned, a combined 60-day-plus status, and a short commentary on each sector's performance. The statistics and commentary are updated monthly. Fitch said the prime and subprime indices are based on loan-level data using actual payment dates. This system allows Fitch to generate indices based on the market approach, an advantage over indices aggregated from the deal level, where the method is dependent upon the servicer, the rating agency said.