Specialty Servicer C-BASS Hit by Margin Calls

New York-based C-BASS LLC, which controls the nation's 10th-largest subprime servicer, has been hit by what its parent companies are calling an "unprecedented amount" of margin calls.According to the Quarterly Data Report, the C-BASS-owned Litton Loan Servicing, Houston, owns the right to service $48 billion in mostly subprime loans. C-BASS is controlled by two publicly traded mortgage insurance firms: MGIC Investment Corp. and Radian Group Inc., which are in the process of merging. (See related story below.) In a statement issued July 31, the two MIs said C-BASS "remains confident in the overall credit quality of its portfolio and the performance of its highly rated servicing subsidiary Litton Loan Servicing." Citing a "tumultuous time" in the subprime market, the two MIs said C-BASS was asked to meet $290 million worth of margin calls during the first half. (At the beginning of the year it had $302 million in liquidity.) C-BASS -- Credit-Based Asset Servicing and Securitization LLC -- can be found online at http://www.c-bass.com.