What We're Hearing

Perhaps, I’ve underestimated PennyMac’s ability to get new business. As we reported yesterday Stan Kurland’s firm will be the servicer on $1.6 billion of non-prime loans that American General Financial Services is selling to Credit Suisse. CS plans to issue securities backed by the loans. Of course, the obvious question (for those who work in servicing) is this: why would CS use PennyMac when it already has its own servicing company, Select Portfolio Services? A CS spokesman has yet to answer my question but one observer said it may be a capacity issue. He added that “PennyMac is a ‘combat’ servicer.” We know this about PennyMac: it has plenty of office space in Southern California and now – thanks to the AGFS/CS deal – it can begin putting people in those empty cubicles. I assume this contract will be among the highlights included in PennyMac’s IPO road show...