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Banks Wheel and Deal

Banks Wheel and Deal

Recent mortgage mergers, acquisitions & corp activity

November 6, 2006


photo of Coco Salazar
Two mortgage units were recently launched, but it was a game of musical chairs being played by some regional bankers that dominated the latest mergers, acquisitions and corporate activity in real estate finance.

But first, Standard & Poor’s announced it placed on positive CreditWatch the five major national financial institutions, Bank of America Corp., Citigroup Inc., J.P. Morgan Chase & Co., U.S. Bancorp and Wells Fargo & Co.

Michael I. Wirth resigned as chief financial officer of New York Mortgage Trust Inc., effective Friday, to pursue another opportunity, according to an announcement Wednesday. Steven R. Mumma, the company’s chief investment officer, was appointed to replace Wirth on an interim basis, but the company anticipates that he could permanently take the role due to his financial and accounting expertise.

A day prior, on Tuesday, New York Mortgage had disclosed that it was discussing the possible sale of the company.

Friedman, Billings, Ramsey Group Inc. reported a net after-tax loss of $67.4 million for the third quarter. The loss was in part due to its subprime mortgage unit First NLC, which generated losses of $7.4 million as a result of a $23 million loss provision that included $17.5 million of “additional reserves related to the impact of an industrywide increase in requests for buybacks of loans related to early pay defaults.”

Fidelity National Information Services Inc. acquired Watterson Prime LLC, which provides outsourced loan due diligence services to Wall Street investors and other financial institutions that invest in and securitize mortgages, according to a press release Thursday.

Heartland Financial USA Inc. announced that its newest de novo, Summit Bank & Trust, opened for business in Broomfield, Colo. and had three other locations planned so far.

Nationwide Bank and Nationwide Federal Credit Union announced that the merger of the two organizations has been approved by their members. As previously announced, Nationwide Bank will pay $79 million for the members’ ownership interest in the credit union.

RBC Centura Bank signed an agreement to buy 39 branches in Alabama from AmSouth Bancorporation in a deal expected be completed in March 2007, according to an announcement.

“Alabama is a strategic and logical extension of our current footprint and banking center network,” RBC Chief Executive Scott Custer said in the announcement.

AmSouth is reportedly divesting the branches as a result of the merger with Regions Financial Corp., and their agreement with the U.S. Department of Justice and the Federal Reserve Board to sell the offices to avoid adversely affecting competition in local markets for small business lending.

Regions announced on Saturday it completed the merger deal with AmSouth, with the conversion of AmSouth branches and other operations to begin in mid-2007.

“This creates a top 10 U.S. bank holding company with leading positions in some of the fastest growing markets in the United States and an even broader range of products, services and locations for our 5 million customer households,” said Jackson W. Moore, chairman of Regions’ board, in the announcement.

Sun American Bancorp reported that it opened a new residential mortgage company, Sun American Financial LLC. The president and principal mortgage broker of the new Boca Raton, Fla.-based lender is Bernardo Reynoso, founder of Iberia Mortgage Corp.

“We are very excited to be able to offer our bank customers residential mortgage services, especially in light of all the recent changes in the industry,” said Michael Golden, president and CEO of the parent company.

WSFS Financial Corp. announced it recently created a reverse mortgage business unit that will be headed by Patricia Kauker as vice president.

Coco Salazar is an assistant editor and staff writer for

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