|Aames Financial Corporation Completes $150.0 Million Securitization and $383.4 Million of Whole Loan Sales
Announces Record Quarterly Loan Production of $683.3 Million During the Three Months Ended June 30, 2001
Renews $200.0 Million Warehouse Facility and Successfully Negotiates Revised Financial Covenants Under All of Its Revolving Warehouse and Repurchase Facilities
LOS ANGELES--(BUSINESS WIRE)--July 23, 2001--Aames Financial Corp. (NYSE: AAM), a leader in subprime home equity lending, announced today the successful completion of a $150.0 million asset backed securitization and $383.4 million in whole loan sales during the recently completed quarter-ended June 30, 2001.
Loan securitization and whole loan sales
The Company announced that it closed a $150.0 million securitization transaction of fixed rate mortgage loans during the June 30, 2001 quarter. The Company sold the residual interest created in the securitization for cash to an affiliate of the Company's largest stockholder under its Residual Forward Sale Facility. The Company also sold for cash the servicing rights and prepayment penalties in the transaction to Countrywide Home Loans, Inc.
The Company also announced that it sold $383.4 million of its Alt A, second mortgage and ARM/Hybrid mortgage loan production through whole loan sales in the secondary market for cash on a servicing-released basis.
``We continue to try to optimize execution between the securitization and whole loan markets to balance our cash flow needs while maximizing opportunities in the secondary mortgage market,'' said A. Jay Meyerson, Chief Executive Officer. ``The mix of securitization and whole loan sales transactions during the quarter reflects that strategy,'' Meyerson continued. ``We continue to see improvements in the quality and pricing of our loan production,'' said John Kohler, Executive Vice President, Capital Markets and Secondary Marketing. ``During the June 30, 2001 quarter, we sold approximately 70% of our production through whole loan sales to capitalize on pricing opportunities in the whole loan sale market,'' Kohler continued. ``Our $150.0 million securitization during the June 2001 quarter was our fourth consecutive quarterly securitization. We remain committed to pursuing a balanced loan disposition strategy by accessing both the whole loan sale and securitization markets.''
Record loan production of $683.3 million during the June 2001 quarter, an increase of $155.1 million from the June 2000 quarter
During the three months ended June 30, 2001 the Company's total loan production was $683.3 million, an increase of $155.1 million, or 29.4%, from the $528.2 million of total loan production reported during the comparable three-month period a year ago. Total retail loan production increased $116.9 million, or 52.6%, to $339.0 million during the quarter ended June 30, 2001, compared to $222.1 million during the quarter ended June 30, 2000. Retail loan production through the Company's branch network increased $94.6 million, or 43.7%, to $311.1 million during the quarter ended June 30, 2001, compared to $216.5 million during the quarter ended June 30, 2000. Retail loan production through the Internet increased $22.3 million to $27.9 million during the quarter ended June 30, 2001, compared to $5.6 million during the quarter ended June 30, 2000. Broker loan production increased $38.2 million, or 12.5%, to $344.3 million during the quarter ended June 30, 2001, compared to $306.1 million during the quarter ended June 30, 2000.
Meyerson stated, ``We are pleased by the continuing growth in our loan production through our traditional retail and broker channels, as well as by the growth of loan production through the Internet.''
Renewal of $200.0 million revolving repurchase facility; Company successfully negotiates revised financial covenants under all of its revolving warehouse and repurchase facilities
During the June 2001 quarter, the Company extended to June 2002 the term of one of its committed repurchase facilities previously scheduled to expire in June 2001. With the recent renewal of this $200.0 million revolving repurchase facility, the Company has access to approximately $790.0 million in committed revolving warehouse and repurchase facilities with which to fund its retail, broker and Internet loan production.
Meyerson said, ``During the June 30, 2001 quarter, the Company successfully negotiated financial covenant amendments under all of its revolving warehouse and repurchase facilities effective as of March 31, 2001. These amendments enabled the Company to meet its financial covenants at March 31, 2001, April 30, 2001 and May 31, 2001 and better enables the Company to meet its financial covenants going forward.''