H&R Block NPL Portfolio Doesn't Sell

A $240 million portfolio of non-performing loans offered for auction by H&R Block has failed to sell, according to participants with knowledge of the deal. At press time, H&R Block's media department had not returned a telephone call about the auction. The mortgages offered belonged to its now defunct subprime division, Option One Mortgage. Those familiar with the transaction declined to be quoted, citing confidentiality agreements. One observer noted that there was strong interest in the portfolio but "the bid price was a little low." Also, professionals who play in the NPL space say very few large NPL deals are getting done these days, citing changes to market-to-market accounting rules promulgated by the Financial Accounting Standards Board. "Banks are less inclined to sell because they don't have to write it down as much," said one investment banker.