Ocwen Reports '03 Profits

Ocwen Financial Corp., West Palm Beach, Fla., has reported net income of $4.8 million ($0.07 per share) for 2003, compared with a loss of $68.8 million ($1.02 per share) in 2002.For the fourth quarter, the company reported net income of $4.5 million ($0.07 per share), compared with a loss of $10.1 million ($0.15 per share) a year earlier. William C. Erbey, Ocwen's chairman and chief executive officer, noted the company's return to profitability, but said its servicing business faces "continuing challenges" from rising prepayment rates. "Prepayment speeds in the subprime sector that comprises the vast majority of our servicing portfolio continue at high levels, resulting in significant costs for this business," Mr. Erbey said. "During 2003, the combined cost of mortgage servicing rights amortization expense and interest on prepayments, which are reported as reductions of fee income, rose by $48 million, or 62%, over 2002 levels." As of Dec. 31, Ocwen serviced approximately $37.7 billion of loans, up 23% from $30.7 billion at year-end 2002, Ocwen said. The company can be found online at http://www.ocwen.com.