A mortgage lender and mortgage broker have merged to create a company that is expected to originate around $120 million annually. Other boardroom activity included Countrywide Financial Corp.’s denial of a planned bankruptcy and Bear Stearns Co.’s replacement of its top executive.
Bear announced Tuesday the appointment of President Alan D. Schwartz as chief executive officer. Schwartz, who has been with the company for over 30 years, succeeds James E. Cayne, who served as CEO since 1993 and has resigned from the firm to stay as chairman of the board.
“I believe this is the right time to implement our succession plan,” Cayne said in the written statement. “We are beginning a new year and are at a pivotal point in the development of our business at a time of rapid change on Wall Street.”
Cayne’s move follows the recent departures of Charles Prince of Citigroup Inc. and Stan O’Neal of Merrill Lynch & Co., who left the companies after write downs in assets tied to subprime mortgages corroded earnings.
Cenlar FSB began the year with its first major change in executive management since 1984 by assigning President Gregory S. Tornquist the additional role of chief executive officer, the New Jersey-based company said. His predecessor Michael W. Young remains as Cenlar’s founding president and chairman.
After falling $0.55 from Tuesday, Countrywide stock was trading at $4.92 Wednesday, near its lowest level during the past year and a far cry from the $45.26 the shares were trading at a year ago. The decline followed a statement by the company denying marketplace rumors that it may file for bankruptcy protection.
“Countrywide has been made aware of rumors in the marketplace regarding the company,” the Calabasas, Calif.-based mortgage giant said in Tuesday’s announcement. “There is no substance to the rumor that Countrywide is planning to file for bankruptcy, and we are not aware of any basis for the rumor that any of the major rating agencies are contemplating negative action relative to the company.”
Sovereign Investment Co. announced it recently completed Peoples Bank’s first sale-leaseback transaction, which is for five branch properties in Kansas and New Mexico that will be leased back for a 15-year period through Triple-net leases. People, which operates 15 branches, will use the capital generated by the sale-leaseback for general corporate purposes. The deal marks the second bank branch sale-leaseback deal in Sovereign’s new financial services leaseback initiative, as the first was one for $30 million for a large regional bank.
“A sale-leaseback is an effective balance sheet management tool for commercial banks,” Sovereign explained in the announcement. “For smaller banks it can result in a lower-cost funding source, especially in today’s credit constrained environment, and can help with meeting regulatory requirements. For larger banks, it can be utilized for many purposes — such as earnings management or to finance acquisitions of smaller banks. Sovereign has a very flexible approach to help banks unlock the potential of the real estate assets on their books“
American Lending Group recently acquired Premier Mortgage Group. The merger of the two Lexington, Ky.-based companies, which operate as American Lending Group, created the largest non-bank mortgage lender in Central Kentucky, according to an announcement.
Combined volume will be about $10 million to $12 million a month or about $120 million annually, American Lender President and CEO Melvin Drury told MortgageDaily.com today.
“Premier is a broker and we’re a direct lender,” he added. “Combining both entities is really a win-win for both of us.”
