Origination

Ameriana Bancorp, New Castle, Ind., along with joint-venture partners First Merchants Corp., Muncie, Ind., and Mutual First Financial, Muncie, has closed on an agreement to sell the assets of Indiana Title Insurance Co. to IN Title Co., a newly formed company led by current ITIC executives. Ameriana's ownership interest in ITIC is 20.94%. Ameriana expects to incur a loss of approximately $225,000 on the sale of this interest, which will be reported in its fourth quarter 2008 results. ITIC has offices in New Castle and Muncie. Jerome J. Gassen, president and chief executive of Ameriana Bancorp, said, "As part of our continued efforts to strengthen our commercial focus and reach new markets, we have made the decision to dispose of our interest in this business that is, at best, ancillary to our primary banking operations. We intend to redeploy the capital from this business to support more attractive growth opportunities in our core operations."

Navy Federal Credit Union, Vienna, Va., after doing $5.7 billion in mortgage originations in 2008, has committed $6 billion to originate mortgage loans for its members in 2009. The 2008 production volume was the second highest in the company's history. According to SourceMedia's Mortgage Industry Directory, Navy FCU did $5.1 billion in 2007 and $4.8 billion in 2006. Cutler Dawson, president and chief executive said that because the CU did not do subprime loans, it "saw a strong 'return to trust' in 2008 and we're committed to continuing that momentum in 2009."

After zooming up 36 basis points between September and October, the Eleventh Federal Home Loan District Cost of Funds Index increased a more modest three basis points between October and November. The Index, as computed by the Federal Home Loan Bank of San Francisco, was 3.155% for November, compared with 3.125% for October. This is the third consecutive increase for this index, which because of its weighted average computation is known as a lagging indicator. Any impact of the Federal Reserve's drastic rate cut is not likely to be seen in COFI for between three and six months from now. To calculate the November index, FHLB-SF used average total funds of $79.3 billion and total interest expense of $208.4 million. More information is located at http://www.fhlbsf.com.

The National Association of Realtors is demanding an explanation for Fannie Mae's latest loan fee hike, warning that it could push more borrowers into Federal Housing Administration loans and counter the government's effort to lower the cost of mortgage financing. In a letter to the GSE's regulator, Realtors president Charles McMillan notes that Fannie provided no "justification or even explanation for the increases" even though it is operating in conservatorship and under government control. A Federal Housing Finance Agency spokeswoman said the agency is "reviewing the Realtors' letter." Fannie Mae continues to charge a 25 basis point adverse market fee on all loans. Starting April 1, Fannie Mae is raising its delivery fees on certain cash-out refinancings, two-unit properties, condominiums, interest-only loans and loans with subordinate financing, according to a Dec. 29 letter to its lenders. The standard delivery fee on a mortgage to a borrower with a 670 credit score and a 20% down payment would go up by 75 basis points to 2.5%. "Is the purpose of increasing fees to shift higher risk borrowers to the FHA insurance program? What will the impact of such a move be in terms of risk and cost to the government and the taxpayer?" the NAR letter says.

The Tennessee Commissioner of Commerce and Insurance is now requiring fingerprints from certain license and registration applicants, including mortgage lenders, brokers, servicers and loan originators. According to written analysis from iComply, which is authored and published by a team of mortgage banking attorneys, there must be provisional authorization for mortgage loan originators to conduct business while awaiting registration approval from the commissioner. The requirement became effective on January 1. In other regulatory news, with the start of the new year North Carolina is requiring mortgage servicers to be licensed by the its Commissioner of Banks before acting as a servicer. The bill also changes the "brick-and-mortar" requirements for mortgage brokers to specify that a broker's physical location in North Carolina may not be a home or residence.

Now that GMAC Financial Services has received both bank holding company approval and a $5 billion investment from the U.S. Treasury, one of its next moves will be to ramp up its deposit gathering capabilities. A spokeswoman for the company said GMAC's bank, GMAC Bank of Utah, will remain as an online bank. She said marketing plans regarding deposits could be announced over the next few weeks. GMACFS also controls Residential Capital Corp. of Horsham, Pa., a $391 billion servicer. In late December the Treasury invested $5 billion in GMACFS, by purchasing preferred stock that carries an 8% yield. "The overall health of GMAC has greatly improved," said the spokeswoman. The company recently completed a note exchange offer that fell short of its goals but the government investment in the company boosted its immediate financial outlook. The warehouse lending platform of GMAC is housed in its bank.

Federal Housing Administration lender Shore Mortgage, Birmingham, Mich., which is licensed in 25 states, said it is planning to significantly grow its origination staff due to rate-driven increases in its business and its reputation for swift mortgage closings. President Robert Rahal said in a prepared statement that the company is seeking to hire an additional 80 to 100 new employees and has a training program for those lacking experience. He said positions the company is seeking to fill include loan officers (10-20 people per month for the next three months), underwriters, processors, closers, post-closing specialists and account executives. The company is licensed to do business in Alabama, Arkansas, Arizona, Florida, Georgia, Illinois, Indiana, Maine, Michigan, Mississippi, Missouri, Montana, Nebraska, New Hampshire, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, South Carolina, Tennessee, Utah, Virginia, Washington and Wisconsin.

Fannie Mae bought just $29.65 billion in mortgages from its seller/servicers in November, its worst purchase month of the year. The government sponsored enterprise also issued $23.8 billion in mortgage-backed securities during the month, a low for the year as well. Its commitments plunged to a yearly low of $21.19 billion in November too. However, since November ended mortgage rates have plunged and the GSE's December commitments should show an increase. Fannie, and its sister company, Freddie Mac, have been operating under a government conservatorship since September.

A consortium of private equity investors led by Dune Capital Management has agreed to pay $13.9 billion to acquire IndyMac and its $158 billion servicing portfolio from the Federal Deposit Insurance Corp. The new owners of IndyMac -- which also includes J.C. Flowers & Co., Paulson & Co. and others -- will control the nation's 10th largest servicing company, according to figures compiled by National Mortgage News and the Quarterly Data Report. Besides the servicing portfolio and platform, Dune and its partners will take control of: a $16 billion loan portfolio, $6.9 billion in securities, the Freedom Financial reverse mortgage business (including $20.2 billion in receivables) and 33 retail branches. The sale is not without risk to the government. FDIC has agreed to share losses on some of the thrift's loans and will be on the hook for $2 billion in construction and other loans made by the Pasadena-based IndyMac. The investors formed IMB Management Holdings to buy the thrift, which will be structured under a holding company called IMB HoldCo LLC. Steven Mnuchin, chairman and co-CEO of Dune, will be chairman and CEO of IMB. The sale was announced Friday afternoon. At least one other bidder -- also a private equity consortium -- was vying for IndyMac, which was created by Countrywide Home Loans in the 1980s as a non-conforming loan conduit. The investor consortium will capitalize the institution with $1.3 billion in cash. IMB will continue IndyMac's much ballyhooed loan modification program where troubled mortgages are restructured, providing consumers with easier payment plans.

The Federal Deposit Insurance Corp. has trimmed the final list of IndyMac bidders down to two private equity consortiums: Dune Capital Management and one other, according to investment banking sources. The identity of the other consortium could not be ascertained at press time. "The deal still isn't done," said the source. "We could hear today or any time over the next few days." The FDIC declined to comment. One source, requesting anonymity, said Apollo Management is out of the running as a bidder. The agency prefers to sell IndyMac FSB of Pasadena, Calif. in a whole bank transaction instead of the government retaining some of its troubled assets. The agency, noted one investment banker, is very focused on getting private equity investors to put as much money as possible at the bank holding company level in the event more cash is needed at an institution. "The problem with private equity investors is that they want as much control as possible but they want limited liability in case something goes wrong," said the investment banker. The FDIC had hoped to complete the deal by year-end but has not. Complicating the sale of IndyMac's $180 billion residential servicing portfolio is large buyback requests forced upon the failed thrift by Fannie Mae. Fannie said it is waiting on "information from the FDIC with regard to servicing valuations and confirmation of the identity and eligibility of the proposed buyers in order to finalize an agreement." Fannie, which is operating under a federal conservatorship itself, added that it "will continue to work constructively with the FDIC and IndyMac Federal Bank to reach a resolution in the near term that is in the best interest of all parties involved." IndyMac was taken over the government last summer and has operated under a conservatorship ever since.