Servicing

Wells Fargo & Co., San Francisco, has reported record net income of $5.71 billion ($3.32 per share) for 2002, up 11% from $5.15 billion ($2.97 per share) in 2001.For the fourth quarter, net income totaled a record $1.47 billion ($0.86 per share), up 10% from $1.33 billion ($0.77 per share) a year earlier. Wells Fargo's mortgage origination volume totaled $333 billion for the year, which it termed an industry record. "The home finance businesses saw exceptional growth in 2002, with total originations of $333 billion surpassing our 2001 industry record of $202 billion," said Mark Oman, group executive vice president for home and consumer finance. The company's owned servicing portfolio ended the year at $535 billion, up 26%, and its home equity portfolio grew 41% to $36 billion, Mr. Oman said.

Standard & Poor's has reported that rating actions on residential mortgage-backed securities doubled in the fourth quarter compared with those of a year earlier, but most of the news was good, as upgrades exceeded downgrades by 214 to 16."The outstanding rating performance of RMBS securities during 2002 was largely due to record levels of prepayments resulting from unprecedented low mortgage rates in the U.S.," said Ernestine Warner, a director in S&P's structured finance surveillance group. In addition, the strength of the housing market contributed to the upgrades.

Standard & Poor's is giving the cold shoulder to loans that are affected by the new Georgia Fair Lending Act.Beginning Feb. 1, S&P said conforming-balance mortgage loans and manufactured housing loans governed by the Georgia law will not be allowed in S&P-rated structured finance transactions. S&P said the decision was based on the determination "that investors cannot be insulated from the potential liability resulting from violation" of the Georgia law through the credit enhancement or legal structure of the securities. The rating agency can be found online at http://www.standardandpoors.com.

The ratings on three classes from various Conseco Finance Corp.-related transactions issued by Home Improvement Loan Trust and Conseco Finance Home Equity Loan Trust 2000-B have been lowered to D by Standard & Poor's Ratings Services.The downgrades were as follows: Home Improvement Loan Trust, series 1994-BI, class B-2, from CCC-minus to D; Home Improvement Loan Trust, series 1994-B, (a single class), from CCC-minus to D; and Conseco Finance Home Equity Loan Trust 2000-B, class BF-2, from CCC-plus to D. S&P said Conseco Finance Corp. did not make any payments under a limited guarantee on the Jan. 15, 2003 distribution date, resulting in principal distribution shortfalls on the two HIL trusts and an interest shortfall on the Conseco Finance HEL trust. Each of the certificates has credit support from a limited guarantee provided by Conseco Finance and from monthly excess spread. S&P can be found online at http://www.standardandpoors.com.

WaMu Capital Corp., a fixed-income institutional broker-dealer and subsidiary of Seattle-based mortgage lending giant Washington Mutual Inc., has reported that it will open a New York sales office in Midtown Manhattan by the end of March.The corporation said it is opening the office to serve the high concentration of clients it has in the region and to complement its offices in Seattle and Los Angeles. Washington Mutual can be found online at http://www.wamu.com.

Household International, Prospect Heights, Ill., has reported net income of $1.6 billion ($3.22 per share) for 2002, down from $1.8 billion ($3.91 per share) in 2001.Net income totaled $338 million ($0.66 per share) in the fourth quarter, down from $533 million ($1.13 per share) a year earlier. Household said the results reflect a $240 million after-tax loss on a previously announced disposition of the assets and deposits of the company's thrift. The company also noted that it incurred a $333 million after-tax nonrecurring charge in connection with its nationwide settlement with state attorneys general and other regulators in the third quarter, which involved making restitution related to its subprime consumer lending businesses. Household can be found online at http://www.household.com.

Six classes in Peachtree Franchise Loan LLC 1999-A have been downgraded by Fitch Ratings.The downgrades were as follows: classes A and A-X, from AAA to A; class B, from AA to BBB; class C, from BBB-minus to B; class D, from B to CCC; and class E, from CCC to CC. All the classes were removed from Rating Watch Negative. The rating agency said $15 million of the $25 million in cumulative defaults in the deal is due to a single large borrower, Westwind ALWA. "The Westwind loan was restructured in September 2001, resulting in a $6.2 million writedown to the trust," Fitch said. "The loan was returned to default status in September 2002, and it is expected that the remaining $8.3 million will be completely written down." Fitch can be found online at http://www.fitchratings.com.

Associates First Capital Corp., New York, has announced a cash tender offer for all the outstanding original principal amount (approximately $2.02 billion) of the class A certificates of Associates Manufactured Housing Contract Trust 1999-1.Associates said validly tendered certificates will be purchased at a price of $1,004.80 (per $1,000 original principal amount) multiplied by 0.5438581, the principal balance factor as of Jan. 15, 2003, plus accrued and unpaid interest up to the settlement date. Salomon Smith Barney is the dealer/manager of the offering, and Mellon Investor Services is the depositary and the information agent. The offer is scheduled to expire at 11:59 p.m. Eastern Time on Feb. 10.

Seven classes of Structured Asset Securities Corp. mortgage pass-through certificates have been downgraded by Fitch Ratings.The downgrades were as follows: SASCO 1996-4, class B3, from BBB to BB, and class B4, from CCC to D; SASCO 2000-3, group 1, class 1B5, from B to CCC; SASCO 2000-3, group 2, class 2B5, from B to C; SASCO 2001-2, class B5, from B to C; SASCO 2001-5, class B5, from B to CCC; and SASCO 2001-9, class B5, from B to C. In addition, class 2B4 of SASCO 2000-3, group 2, and the B4 classes of SASCO 2001-2 and SASCO 2001-9 were placed on Rating Watch Negative. Fitch attributed the actions to loss levels and "future loss expectations on the current severely delinquent loans in the pipeline" relative to the applicable credit support. Fitch can be found online at http://www.fitchratings.com.

WaMu Capital Corp., a fixed-income institutional broker-dealer and subsidiary of Seattle-based mortgage lending giant Washington Mutual Inc., has reported that it will open a New York sales office in Midtown Manhattan by the end of March.The corporation said it is opening the office to serve the high concentration of clients it has in the region and to complement its offices in Seattle and Los Angeles. Washington Mutual can be found online at http://www.wamu.com.