Franklin Credit Announces Purchase of $99 Million Subprime Mortgage Portfolio
October 20 2004 - 6:22PM
PR Newswire (US)
Franklin Credit Announces Purchase of $99 Million Subprime Mortgage
Portfolio NEW YORK, Oct. 20 /PRNewswire-FirstCall/ -- Franklin
Credit Management Corp. (OTC:FCSC) (BULLETIN BOARD: FCSC) , a
specialty financial services company that acquires, manages and
sells subprime residential mortgage assets, today announced the
purchase of a mixed pool of performing, subperforming, and
nonperforming mortgage loans (and related servicing rights) with a
face value totaling approximately $99.3 million. The loans, which
are secured by single- family residences, were purchased from
Master Financial Corporation, N.A. Master Financial Corporation is
a national mortgage banking company that is headquartered in
Orange, CA. The purchase of the mortgage pool was funded by an
extension of the Company's Senior Debt facility with Sky Financial
Bank ("Sky Financial") pursuant to the Company's Master Credit and
Security Agreement with Sky Financial. The new Senior Debt bears
interest at a rate initially equal to 5.5% adjusted monthly as
provided in the Master Credit Agreement. "We are very pleased to
announce the closing of this bulk purchase of subprime mortgage
loans," stated Jeffrey Johnson, Chief Executive Officer of Franklin
Credit Management Corp. "On a pro forma basis, the purchase expands
our Net Notes Receivable portfolio by more than 12.6%, to
approximately $732 million as of June 30, 2004. We expect the
acquisition of this mortgage pool to be accretive to net income and
earnings per share in the twelve months following the closing of
the transaction." About Franklin Credit Management Corp. Franklin
Credit Management Corporation ("FCMC", and together with its
wholly-owned subsidiaries, the "Company") is a specialty consumer
finance and asset management company primarily engaged in the
acquisition, origination, servicing and resolution of performing,
sub-performing and non-performing residential mortgage loans and
residential real estate. The Company acquires these mortgages from
a variety of mortgage bankers, banks, and other specialty finance
companies. These loans are generally purchased in pools at
discounts from their aggregate contractual balances, from sellers
in the financial services industry. Real estate is acquired in
foreclosure or otherwise and is also generally acquired at a
discount relative to the appraised value of the asset. The Company
conducts its business from its executive and main office in New
York City and through its website http://www.franklincredit.com/.
Its common stock trades on the OTC Bulletin Board under the symbol
"FCSC". Statements contained herein that are not historical fact
may be 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, that are subject
to a variety of risks and uncertainties. There are a number of
important factors that could cause actual results to differ
materially from those projected or suggested in forward-looking
statements made by the Company. These factors include, but are not
limited to: (i) unanticipated changes in the U.S. economy,
including changes in business conditions such as interest rates,
and changes in the level of growth in the finance and housing
markets; (ii) the status of relations between the Company and its
sole Senior Debt Lender and the Senior Debt Lender's willingness to
extend additional credit to the Company; (iii) the availability for
purchases of additional loans; (iv) the status of relations between
the Company and its sources for loan purchases; (v) unanticipated
difficulties in collections under loans in the Company's portfolio;
and (vi)other risks detailed from time to time in the Company's SEC
reports. Additional factors that would cause actual results to
differ materially from those projected or suggested or suggested in
any forward-looking statements are contained in the Company's
filings with the Securities and Exchange Commission, including, but
not limited to, those factors discussed under the caption "Real
Estate Risk" in the Company's Annual Report on Form 10-K and
Quarterly Reports on Form 10-Q, which the Company urges investors
to consider. The Company undertakes no obligation to publicly
release the revisions to such forward-looking statements that may
be made to reflect events or circumstances after the date hereof or
to reflect the occurrences of unanticipated events, except as other
wise required by securities and other applicable laws. Readers are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date hereof. The Company
undertakes no obligation to release publicly the results on any
events or circumstances after the date hereof or to reflect the
occurrence of unanticipated events. For further information, please
contact: Alan Joseph, CFO of Franklin Credit Management Corp. at
212-925-8745 (Ext. 169) DATASOURCE: Franklin Credit Management
Corp. CONTACT: Alan Joseph, CFO of Franklin Credit Management
Corp., +1-212-925-8745 ext. 169, Web site:
http://www.franklincredit.com/
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