Accenture plans to acquire Dallas-based outsourcing and fulfillment firm Zenta, a move that adds new mortgage industry-related capabilities, licenses and technology to the global consulting and outsourcing firm's portfolio.
Zenta's 3,700 employees provide business-process outsourcing in mortgage origination fulfillment, servicing-loss mitigation, and portfolio due diligence and management for investors. It has facilities in Charlotte, N.C., India and the Philippines.
The deal will expand Accenture's outsourcing capabilities for its existing large mortgage lender and servicer clients. Its terms were not disclosed.
“We had dabbled in credit BPO with some clients and some business, but we realized we didn't have the deeply skilled end-to-end capability that's really required to attack the challenges that are so apparent in this market right now, with both lenders and servicers, origination and loss mitigation,” says Terry Moore, former managing director of Accenture's North America banking practice.
“With Zenta, we get unmatched end-to-end processing capabilities that are licensed.”
As part of the deal, Moore will become the global managing director of a new Accenture Credit Services unit, which will provide consulting, technology and BPO services for both the residential mortgage and commercial real estate industries. The unit also plans to eventually expand into leasing and automotive finance.
Zenta's origination fulfillment capabilities begin after a borrower receives initial disclosures and continue through the closing process. The vendor works within the lender's existing loan origination system and other technology, but provides additional workflow and decisioning automation to cut down on expenses.
“Our business isn't focused on overflow volume,” Moore says. “Our business is really focused on the origination, fundamentally driving better metrics for the client such that they want to send volume to us even in low volume times because we can do it better, faster and cheaper.”
The same efficiency and workflow technology principles are applied to the loss-mitigation efforts of servicers, he adds.
“What's really unique about Zenta is the way that they attack the problem on both the origination and loss-mit side,” he said. “They are able to do a lot more rigorous process work to inspect the loan information that comes in for the customers, figure out what they're missing and do an efficient job of working the loan through the process very quickly, while maintaining that quality.”
Loss-mitigation operations “need a lot of help, but they don't just need generic help,” according to Moore. “They need highly skilled resources that are proven, that can process loan modifications very efficiently with high quality, very high-touch customer service, because the borrower contact in that situation is paramount.”
But he adds that Accenture doesn't see the move as one that makes it a servicer or subservicer, because using outsourcing services from Accenture won't affect a servicer's capital requirements.
“You should think of us as an extension of a bank's processing capability, but our intent is to not take balance sheet risk. We don't intend to be a servicer,” Moore said.
Additionally, Moore said Accenture Credit Services will assist real estate investment trusts with their due diligence reviews of mortgage and real estate business, including financial analysis, valuations and other portfolio management tasks.
Earlier this year, Accenture was rumored to be in discussions to buy or to partner with ISGN, another mortgage fulfillment outsourcer and technology provider. Moore declined to comment on any connection between those rumors and the Zenta acquisition.
Nor would he discuss how the deal affects Accenture's position among its competitors, notably IBM, which has embarked on its own strategy to subservice loans for Fannie Mae.
“I would characterize our strategy as one that's unique in the marketplace, one that combines a very strong track record from a consulting and systems integration expertise perspective, with unmatched, deep-mortgage, licensed-processing capability that I think is going to be what our clients are looking for to help them solve their problems,” Moore said.
