PennyMac Investing in AIG Unit's MBS Too

Not only will PennyMac be servicing nonperforming mortgages for Credit Suisse — which is buying the loans from a troubled American International Group unit — but the vulture fund/servicer has agreed to buy $170 million in notes that will be issued from the deal. Earlier this week it was revealed that CS agreed to buy $1.6 billion of subprime and alt-A whole loans from AIG's American General Financial Services unit with PennyMac servicing the loans. CS plans to issue securities backed by the troubled loans. A report by Bloomberg, which quotes a regulatory filing, says PennyMac will buy some of those securities. A spokeswoman for the company declined to comment. "We're in our quiet period," she said. PennyMac hopes to go public some time over the next few months.