Saxon May Consider REIT Status

The chief executive of Saxon Capital Inc., Glen Allen, Va., says there is a possibility that the company could become a real estate investment trust, depending on market reaction to its future financing efforts.Answering a question at the Friedman Billings Ramsey annual investor conference in New York, Mike Sawyer said the subprime lender expects to go back to the capital markets when it reaches a point of equilibrium in its whole loan mortgage portfolio. (Equilibrium is the point when the amount of loans entering the portfolio equals the amount running off.) Saxon is still using capital from its initial public offering to expand its portfolio. Mr. Sawyer said the company is "several quarters" away from having to return to the markets. But if the markets are not favorable to the company's plan to continue expanding its portfolio, Saxon would consider becoming a REIT, he said.