Stonegate Mortgage, Indianapolis, is looking to help banks deal with balance sheet volatility regarding mortgages, while at the same build its servicing portfolio. So it is starting a financial institutions channel to purchase loans on both a wholesale and correspondent basis.
Jim Cutillo, chief executive of Stonegate Mortgage, said among the issues banks are facing is the volatility of the mortgage asset and how it affects their Tier I capital. Rules put in place under Basel III mean they have to reduce their concentration in mortgages and Stonegate wants to be the place for them to turn to help with balance sheet management.
Its advantage, compared with some of the others who buy loans from financial institutions, he said, is that it is a non-bank and thus not competition for their deposit customers.
Cutillo said to support its growth efforts, Stonegate recently entered into a private equity transaction with Long Ridge Equity Partners. It plans to use the capital to expand its portfolio of mortgage servicing rights and continue its growth in the correspondent and wholesale loan origination channels.
Stonegate will acquire the servicing on the loans originated through the financial institutions channel.
To run the financial institutions unit, Stonegate has hired Doug Miller, formerly of GMAC/Ally Bank, where for the last two years he was responsible for all sales in the community financial institution's channel, working out of Memphis, Tenn. He has also worked at Washington Mutual and Citicorp.
Miller will report to Steve Landes, executive vice president, loan origination for Stonegate.
