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World of Mortgage Finance

Recent mergers, acquisitions and other corporate activity

March 28, 2006


photo of Coco Salazar
As banks dominate the latest mortgage-sector mergers, acquisitions and other corporate activity, the second richest man in the world is making a deeper foray into real estate finance.

But first, Clayton Holdings Inc. announced Friday its public offering of 7.5 million shares of common stock, at $17.00 per share. Additionally, underwriters were granted the right to purchase up to an additional 1.13 million shares at the initial public offering price.

American Brokers Conduit recently opened a branch in Sunrise, Fla., which represents its 30th branch nationally and its second in the Sunshine State, the wholesale division of American Home Mortgage Investment Corp. recently announced.

Compass Bancshares Inc. said today it completed acquiring TexasBanc Holding Co., a combination that provides “increased branch convenience, as well as access to a broader array of financial products and services.”

The merger reportedly creates the fifth-largest bank in Texas and fourth in the Dallas-Fort Worth-Arlington metropolitan area, based on deposit market share, while total assets of $32.6 billion rank it as the 28th largest U.S. bank holding company.

In Columbus, Ga., Synovus announced it acquired Riverside Bancshares Inc., a significant step to grow its presence in the metropolitan Atlanta market.

As a result, Riverside Bank merged into and under the name of Synovus’ affiliate, Bank of North Georgia, and former Riverside Chairman and Chief Executive Kessel Stelling Jr. is now Bank of North’s president and chief operating officer, according to the announcement.

Enterprise Financial Services Corp. said it agreed to acquire Kansas City, Mo.-based NorthStar Bancshares Inc. for $36 million in stock and cash.

“The NorthStar acquisition will allow us to materially increase our footprint in the Kansas City market to augment our rapidly growing banking and wealth management franchise there,” NorthStar Chairman and Chief Executive Lee Walker said in the statement.

Meanwhile, Mercantile Bancorp Inc. expects to receive cash and stock from Enterprise Financial of about $6.6 million for its 19.6 percent equity interest in NorthStar.

Mercantile Bankshares Corp. has signed a definite agreement to acquire James Monroe Bancorp Inc. in cash-and-stock transaction valued at nearly $143 million.

The merger will add to Mercantile six full-service branches and a loan production office located in the strategic, affluent, fast- growing markets of Northern Virginia and suburban Washington, D.C.

The Federal Reserve Board approved for BB&T Corp. to acquire Main Street Banks Inc.

A commenter opposing the merger alleged BB&T engaged in discriminatory treatment of minority individuals in its home mortgage lending, but the Fed’s examinations found the bank active in helping to meet the credit needs of its entire communities.

While similar allegations were made against National City Corp., the Fed also concluded it was active in meeting credit needs and approved for the Ohio-based lender to acquire Forbes First Financial Corp.

Fieldstone Investment Corp. said Monday it will delay the filing of its 2005 annual report on Form 10-K until April 17, 2006, upon approval by the Securities and Exchange Commission.

“Fieldstone is re-examining its financial statements for 2003 through 2005 and needs additional time to complete its reassessment regarding the appropriate recognition of income tax expense on inter-company transactions in 2003 and 2005 within Fieldstone’s consolidated group,” the Maryland-based parent of Fieldstone Mortgage Co. said.

A final determination to change recognition of the tax expense would reportedly require a restatement of Fieldstone’s financial statements for the years 2003 and 2004 and for each of the first three quarters of 2005.

EMC Mortgage Corp. announced it hired John Vella its new president and chief operating officer.

Vella, with over 20 years in the mortgage industry, previously was president and COO for Aames Investment Corp., which Monday again announced negative earnings and noted its current reorganization resulted in 100 layoffs. Earlier this month, Aames announced it decided to eliminate its status as a real estate investment trust in order to reduce costs and enable loan portfolio growth, produce an increase in book value and allow the retention of earnings.

Vella’s resume also includes executive positions at Option One Mortgage Corp., Household International, GMAC/RFC, Freddie Mac, Fleet National Bank and FDIC/FSLIC, according to the announcement.

In Minneapolis, Minn., HomeServices of America Inc. said it acquired Huff Realty, a full-service residential real estate brokerage, mortgage and title firm with offices in Cincinnati and northern Kentucky.

HomeServices is an affiliate of Berkshire Hathaway, whose umbrella of companies includes Vanderbilt Mortgage and Finance Inc. and 21st Mortgage Corp., amongst others in the network assembled by the second-richest individual in the world, Warren Buffet.

Huff Realty’s mortgage lending company, Traditions Mortgage, reportedly closed $78 million in mortgage volume.

Coco Salazar is an assistant editor and staff writer for

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