Two mortgage giants eye more investor appetite in NYSE Texas

Two Texas-based mortgage giants are hoping to attract more investors in their own backyard, announcing dual listings on the New York Stock Exchange Texas.

Plano-based Finance of America and Dallas-based Hilltop Holdings, the parent of Plainscapital Bank and Primelending, are founding members of the new fully-electronic exchange headquartered in Dallas. The NYSE, owned by Intercontinental Exchange, announced earlier this year it was relocating its Chicago operation to Texas, citing a thriving economy and population growth in the Lone Star State.

"We believe this dual listing will broaden investor access and awareness of our mission — to educate more Americans on the value of home equity-based retirement solutions," said Graham Fleming, FOA CEO, in a press release Thursday.

Mega homebuilder D.R. Horton is also dual-listing on the NYSE Texas. Companies can dual list, with the same symbol, at no cost, according to the NYSE. The exchange debuts ahead of a Texas Stock Exchange also set to open in Dallas next year.

How Finance of America and Hilltop have performed this year

The companies are coming off of profitable second quarters, although their outlooks for the rest of the year differed. 

The reverse mortgage lender FOA reported funded volume rising quarterly and annually, while its profits didn't sway. It also announced its repurchase of an eight-figure equity stake in the company by Wall Street giant Blackstone. FOA also completed its first $1 billion securitization for its proprietary Homesafe second lien product. 

Primelending also recorded gains in originations and income on a quarterly and annual basis, generating $2.43 billion in loan volume to close the second quarter. A gain-on-sale margin of 228 basis points also matched its highest mark in the prior nine quarters. 

Leadership however warned of a gloomier forecast, with Hilltop President and CEO Jeremy Ford last month citing a competitive market combined with high home prices and elevated interest rates. 

The mortgage industry meanwhile enjoyed a brief reprieve last week, as application volume shot up on the lowest interest rates since February.

FOA's stock was trading at $27.93 a share midmorning Thursday down 3%, while Hilltop's stock inched up to $32.78.