Ocwen Financial Corporation (NYSE: OCN) (“Ocwen” or the “Company”),
a leading non-bank mortgage servicer and originator, issued the
following statement in response to the minimum financial
eligibility requirements for enterprise seller/servicers and Ginnie
Mae issuers announced by the Federal Housing Finance Agency
(“FHFA”) and Ginnie Mae (“GNMA”).
“We are currently in compliance with the new FHFA and GNMA
liquidity and capital standards and expect to be in compliance when
they take effect in September 2023, with the exception of the GNMA
risk-based capital ratio. We are having discussions with GNMA with
respect to their risk-based capital requirements, which take effect
at year-end 2023. We are evaluating our alternatives, as well as
the costs and benefits of achieving compliance with the GNMA
risk-based capital requirements. GNMA forward servicing and
originations is not a material portion of our business activities,
comprising approximately 4% of our total servicing UPB as of June
30, 2022 and less than 10% of our year-to-date origination volume
as of August 31, 2022. The alternatives we are evaluating include
but are not limited to external investor solutions, structural
solutions or exiting GNMA forward originations and owned servicing.
Regardless, we expect we will continue to subservice GNMA forward
mortgages and originate, subservice and own GNMA Reverse mortgages
(or HECMs), as we do not believe these activities will be impacted
by the new regulations. We intend to manage our business
appropriately to achieve compliance with the risk-based capital
standards when these rules take effect. We expect to continue to
repurchase shares under our previously announced share repurchase
program.”
Earlier this year, Ocwen’s mortgage subsidiary, PHH Mortgage,
was recognized for servicing excellence through Freddie Mac’s Gold
Servicer Honors and Rewards Program (SHARP)SM award in the top tier
servicing group and Fannie Mae’s Servicer Total Achievement and
Rewards (STAR)TM performer recognition for General Servicing,
Solution Delivery and Timeline Management, and achieved HUD’s Tier
1 servicer ranking.
About Ocwen Financial Corporation
Ocwen Financial Corporation (NYSE: OCN) is a leading non-bank
mortgage servicer and originator providing solutions through its
primary brands, PHH Mortgage and Liberty Reverse Mortgage. PHH
Mortgage is one of the largest servicers in the country, focused on
delivering a variety of servicing and lending programs. Liberty is
one of the nation’s largest reverse mortgage lenders dedicated to
education and providing loans that help customers meet their
personal and financial needs. We are headquartered in West Palm
Beach, Florida, with offices and operations in the United States,
the U.S. Virgin Islands, India and the Philippines, and have been
serving our customers since 1988. For additional information,
please visit our website (www.ocwen.com).
Forward-Looking Statements
This presentation contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended.
These forward-looking statements may be identified by a reference
to a future period or by the use of forward-looking terminology.
Forward-looking statements are typically identified by words such
as “expect”, “believe”, “foresee”, “anticipate”, “intend”,
“estimate”, “goal”, “strategy”, “plan” “target” and “project” or
conditional verbs such as “will”, “may”, “should”, “could” or
“would” or the negative of these terms, although not all
forward-looking statements contain these words, and includes
statements in this press release regarding our assessment of our
future ability to comply with the FHFA and GNMA financial
eligibility requirements, the impact of these requirements on our
business, and the courses of action we are considering in response
to these new requirements. Forward-looking statements by their
nature address matters that are, to different degrees, uncertain.
Our business has been undergoing substantial change and we are
experiencing significant changes within the mortgage lending and
servicing ecosystem which has magnified such uncertainties. Readers
should bear these factors in mind when considering such statements
and should not place undue reliance on such statements.
Forward-looking statements involve a number of assumptions,
risks and uncertainties that could cause actual results to differ
materially. In the past, actual results have differed from those
suggested by forward looking statements and this may happen again.
Important factors that could cause actual results to differ
materially from those suggested by the forward-looking statements
include, but are not limited to, the potential for ongoing
disruption in the financial markets and in commercial activity
generally as a result of international events, changes in monetary
and fiscal policy, and other sources of instability; the impacts of
inflation, employment disruption, and other financial difficulties
facing our borrowers; uncertainty relating to the continuing
impacts of the COVID-19 pandemic, including the response of the
U.S. government, state governments, the Federal National Mortgage
Association (Fannie Mae) and Federal Home Loan Mortgage Corporation
(Freddie Mac) (together, the GSEs), Ginnie Mae and regulators; our
ability to improve our financial performance through cost and
productivity improvements; the extent to which our MSR asset
vehicle (MAV), other transactions and our enterprise sales
initiatives will generate additional subservicing volume, increase
market share within the subservicing market, and result in
increased profitability; the timing and amount of presently
anticipated forward and reverse loan boarding; whether we will
increase the total investment commitments in MAV, and if so, when
and on what terms; our ability to close acquisitions of MSRs and
other transactions, including the ability to obtain regulatory
approvals; the quantity, timing and long-term impact of additional
stock repurchases; our ability to continue to grow our reverse
servicing business; our ability to retain clients and employees of
acquired businesses, and the extent to which acquisitions and our
other strategic initiatives will contribute to achieving our growth
objectives; the extent to which we will be able to execute call
rights transactions, and whether such transactions will generate
the returns anticipated; the adequacy of our financial resources,
including our sources of liquidity and ability to sell, fund and
recover servicing advances, forward and reverse whole loans, and
HECM and forward loan buyouts and put backs, as well as repay,
renew and extend borrowings, borrow additional amounts as and when
required, meet our MSR or other asset investment objectives and
comply with our debt agreements, including the financial and other
covenants contained in them; increased servicing costs based on
increased borrower delinquency levels or other factors; the future
of our long-term relationship with Rithm Capital Corp.; the
performance of our lending business in a competitive market and
uncertain interest rate environment; our ability to execute on
identified business development and sales opportunities;
uncertainty related to past, present or future claims, litigation,
cease and desist orders and investigations regarding our servicing,
foreclosure, modification, origination and other practices brought
by government agencies and private parties, including state
regulators, the Consumer Financial Protection Bureau (CFPB), State
Attorneys General, the Securities and Exchange Commission (SEC),
the Department of Justice or the Department of Housing and Urban
Development (HUD); adverse effects on our business as a result of
regulatory investigations, litigation, cease and desist orders or
settlements and the reactions of key counterparties, including
lenders, the GSEs and Ginnie Mae; our ability to comply with the
terms of our settlements with regulatory agencies and the costs of
doing so; increased regulatory scrutiny and media attention; any
adverse developments in existing legal proceedings or the
initiation of new legal proceedings; our ability to effectively
manage our regulatory and contractual compliance obligations; our
ability to interpret correctly and comply with liquidity, net worth
and other financial and other requirements of regulators, the GSEs
and Ginnie Mae, as well as those set forth in our debt and other
agreements; our ability to comply with our servicing agreements,
including our ability to comply with the requirements of the GSEs
and Ginnie Mae and maintain our seller/servicer and other statuses
with them; our ability to fund future draws on existing loans in
our reverse mortgage portfolio; our servicer and credit ratings as
well as other actions from various rating agencies, including any
future downgrades; as well as other risks and uncertainties
detailed in our reports and filings with the SEC, including our
annual report on Form 10-K for the year ended December 31, 2021 and
any current report or quarterly report filed with the SEC since
such date.
Anyone wishing to understand Ocwen’s business should review our
SEC filings. Our forward-looking statements speak only as of the
date they are made and, we disclaim any obligation to update or
revise forward-looking statements whether as a result of new
information, future events or otherwise.
FOR FURTHER INFORMATION CONTACT:
Dico Akseraylian |
T: (856) 917-0066 |
E: mediarelations@ocwen.com |
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