ItsAValueTrap Posted February 5, 2015 Share Posted February 5, 2015 I'm disappointed about: - Not buying back stock - Not buying back debt when it is trading at ~80 cents on the dollar. - They intend on hiring two financial advisers. I do not like companies that hire consultants and advisers. Link to comment Share on other sites More sharing options...
philly value Posted February 5, 2015 Share Posted February 5, 2015 I don't see how they could proceed with flexing the balance sheet at this time and buying back stock. My guess would be that buybacks are only realistic after the divestiture of agency MSRs is completed and their liquidity position has improved. The way the buybacks have proceeded at OCN and ASPS is quite bizzare IMO. It seems mgmt was totally blindsided by the severity of the regulatory issues even as recently as a few months ago. Only in the time period since November were the buybacks halted, and I would have thought that they would have understood that a return to normal wasn't possible long before that. Link to comment Share on other sites More sharing options...
ItsAValueTrap Posted February 6, 2015 Share Posted February 6, 2015 Regarding the Ocwen update, it seems that Ocwen will not be in full compliance with the CFPB metrics. On the National Mortgage Settlement front, although we do not have the final results of the retesting of certain 2014 metrics by the National Monitor overseeing compliance, we do expect that, similar to many other Servicers in 2014, we will have metrics that will require remediation through corrective action plans as defined by the settlement. Link to comment Share on other sites More sharing options...
Guest roark33 Posted February 6, 2015 Share Posted February 6, 2015 It is interesting to think that most bull reports argued that Ocwen was the only one that had complied with all the metrics from the national settlement monitor--whereas GreenTree hadn't. Now, we know that's not the case, because Ocwen was self-reporting numbers that weren't correct. I think Ocwen is still probably somewhat cheap, i.e. if it doesn't go bankrupt, it will be worth more. That being said, I think it shows the quality and integrity of management, which just isn't something I want to be involved with. Link to comment Share on other sites More sharing options...
namo Posted February 6, 2015 Share Posted February 6, 2015 That was much less bearish than... pretty much all of your previous statements, roark. Did you stop believing that there is fraud going on at Ocwen? I'm fairly happy with the OCN statement to stakeholders, in part thanks to the greater transparency. I think they could have implemented a small debt- or share-buying program, but like mvalue I don't mind conservatism in this instance. Link to comment Share on other sites More sharing options...
ItsAValueTrap Posted February 7, 2015 Share Posted February 7, 2015 It is interesting to think that most bull reports argued that Ocwen was the only one that had complied with all the metrics from the national settlement monitor--whereas GreenTree hadn't. Now, we know that's not the case, because Ocwen was self-reporting numbers that weren't correct. I think Ocwen is still probably somewhat cheap, i.e. if it doesn't go bankrupt, it will be worth more. That being said, I think it shows the quality and integrity of management, which just isn't something I want to be involved with. The evidence I've seen mostly points towards incompetence / cutting corners. “I’m not saying everybody there did wrong,” Smith said. “The best you could say about it was it was sloppy. It could be more.” http://www.latimes.com/business/la-fi-ocwen-review-20141216-story.html The document that was filed with the court says that Ocwen has been co-operating with the CFPB. It doesn't seem to say anything about Ocwen manipulating the test results or methodology. https://www.jasmithmonitoring.com/omso/wp-content/uploads/sites/4/2014/12/Pldg-194-Monitors-Interim-Report-re-Ocwen-Loan-Servicing.pdf . The IRG Investigation revealed an under-staffed IRG during Test Period 7 and a dysfunctional and chaotic working environment within the IRG during that Test Period; one which led to serious problems and flaws in the processes and procedures by which the IRG tested loans against numerous Metrics during Test Period 7, including (1) the inability of the IRG Executive to certify the results for Test Period 7 without prior written assurances from a member of Servicer’s in-house legal department and (2) Metric 19 being tested improperly, leading to the results for that metric being reported inaccurately. As a result, I concluded that the IRG’s processes and procedures, at least in Test Period 7, lacked the critical keys to integrity mandated in the Enforcement Terms, namely “an internal quality control group that is independent from the line of business whose performance is being measured,”12 and an internal quality control group with “the appropriate authority, privileges and knowledge to effectively implement and conduct the reviews and metric assessments contemplated” in the Enforcement Terms. 13 --- I think the bigger issue is that they aren't in compliance. But... the CFPB has been super lax on the servicers compared to the NY DFS. It's interesting that the CFPB seems to allow servicers to take some kickbacks on force-placed insurance. Link to comment Share on other sites More sharing options...
Guest roark33 Posted February 7, 2015 Share Posted February 7, 2015 This is the best part: they have their own bat-phone.... Finally, Servicer has agreed to work with me to establish a hotline to my office that employees of the IRG may use to report concerns any such employees may have relative to the IRG and its operations. This hotline, which is operational, will also be available for use by employees of the other Servicers’ respective IRGs and these employees have been so notified by me. The identity of callers to the hotline and their messages will be afforded appropriate confidentiality, and calls will be reviewed and acted upon by me when action is deemed appropriate. Link to comment Share on other sites More sharing options...
Guest roark33 Posted February 9, 2015 Share Posted February 9, 2015 Even if you have no financial interest in any of these entities, it is such an interesting soap opera, er, I mean, learning experience. Shareholder wants HLLS to terminate OCN as servicer... http://www.prnewswire.com/news-releases/mangrove-partners-delivers-letter-to-board-of-directors-of-home-loan-servicing-solutions-ltd-urging-termination-of-hlsss-relationship-with-ocwen-loan-servicing-llc-300032784.html Link to comment Share on other sites More sharing options...
davidoosnk Posted February 10, 2015 Share Posted February 10, 2015 One more reason I don't think Ocwen is going bankrupt anytime soon... Just hit my inbox... Ocwen Loan Servicing, LLC – Third-Party Auditor Applications Being Accepted OCWEN The DBO is accepting applications from firms or persons interested in serving as the independent, third-party auditor for Ocwen Loan Servicing, LLC (Ocwen), pursuant to paragraphs 4 through 18 of the DBO’s Jan. 23, 2015 Consent Order. Applicants should submit a statement of interest summarizing their qualifications, areas of expertise, past experience – including any experience with the California Residential Mortgage Lending Act and California Homeowner Bill of Rights – and any additional materials, not to exceed 15 pages, either by e-mail to alex.calero@dbo.ca.gov or in hard copy to: Alex M. Calero California Department of Business Oversight 1350 Front Street, Room 2034 San Diego, CA 92101 Applicants must disclose to the DBO any information that might be viewed as creating an actual or perceived conflict of interest, including without limitation: a) All prior contacts the applicant and all individuals designated by the applicant have had with Ocwen, or any Ocwen affiliate or subsidiary. b) All prior contacts any affiliate or subsidiary of the applicant, or any relative of all individuals designated by the applicant, have had with Ocwen or Ocwen affiliates or subsidiaries. c) Any additional information regarding the relationship of the applicant, its affiliates or subsidiaries, or any of the individuals designated by the applicant, to Ocwen or Ocwen affiliates or subsidiaries that might be viewed as creating an actual or perceived conflict of interest, including but not limited to: financial, business or customer/client relationship; stock ownership; or prior, current or contemplated business transactions. d) Any information regarding whether the applicant, or any affiliate or subsidiary of the applicant, have applied to be on, or are on, a pre-qualified/pre-approved list for providing consultant, advisory or other services to Ocwen or Ocwen affiliates or subsidiaries. Applicants should submit information under items a-d above for each individual or entity with whom the applicant anticipates sub-contracting for work relating to this auditor position. In addition, applicants should disclose any pending matters in which they are currently appearing or may appear before the DBO. All application materials, including the Auditor Application Form, must be postmarked no later than Feb. 20, 2015. http://www.dbo.ca.gov/ENF/Ocwen/OcwenAuditorApplication.pdf http://www.dbo.ca.gov/ENF/Ocwen/ConsentOrderExecuted01_23_15.pdf Link to comment Share on other sites More sharing options...
RadMan24 Posted February 11, 2015 Share Posted February 11, 2015 At this point, they need to regain profitability before buying back stock. The oversight, credit investors, and business model changes are going to require a level of safety. In the mean time, it's worth seeing if the executives buy stock in their own accounts on the open market. Link to comment Share on other sites More sharing options...
Guest roark33 Posted February 11, 2015 Share Posted February 11, 2015 I am not really sure why the auditor employment offer for the DBO would have any impact on OCN one way or the other. The DBO is going about its business to install an outside monitor. By the way, that job was posted about a week or so ago on a couple of mortgage industry websites. Link to comment Share on other sites More sharing options...
Liberty Posted February 11, 2015 Share Posted February 11, 2015 https://glennchan.wordpress.com/2015/02/11/ocwenaltisource-what-went-wrong/ Link to comment Share on other sites More sharing options...
davidoosnk Posted February 11, 2015 Share Posted February 11, 2015 Roark-- the fact that CA is going about the job posting in a matter-of-fact manner could be interpreted to mean that the likelihood of a Black Swan event like shutting Ocwen down asap is unlikely to emanate from California regulators. It is a mildly optimistic data point in terms of Ocwen avoiding a near term worst-case scenario. Hope this clarifies. Link to comment Share on other sites More sharing options...
valueinvestor82 Posted February 12, 2015 Share Posted February 12, 2015 I am still amazed that the lowest probability event (transfer of servicing rights) was reflected as the highest probability, judging by the bat sh*t crazy decline in the stock. I still don't see many people stepping back and asking- this company has $400 billion of servicing rights. Who would take them? How would that not be disruptive to OCN, the government regulators, and the homeowners? Those reasons (and secondarily the higher net asset value, even in a stressed scenario) should be a reason to hold on, in my opinion. When the sales of the agency MSRs begin imminently, buybacks/debt repayment begins, and Q2 will show new acquisition of servicing rights. We should be in the teens...now, not counting 6 months from now. Link to comment Share on other sites More sharing options...
ItsAValueTrap Posted February 12, 2015 Share Posted February 12, 2015 Q2 will show new acquisition of servicing rights. The NY DFS and California DBO consent orders both prevent Ocwen from purchasing more MSRs. The terms of each are different. If Ocwen meets the NY DFS-appointed monitor's benchmarks, it will be able to buy. I'm not sure about the California DBO. It looks like the monitor they appoint will give Ocwen another colonoscopy. Who knows if the DBO uses that as a pretext to go after Ocwen for violating HBOR in some way. *I'm not very good at predicting what regulators will do. Link to comment Share on other sites More sharing options...
valueinvestor82 Posted February 12, 2015 Share Posted February 12, 2015 You're right Trap, my mistake. I revisited the document which only reflect entering into RMBS reverse call transactions. Also they mentioned growth beginning in other areas in Q2 in their conference call held late 2014. Link to comment Share on other sites More sharing options...
jay21 Posted February 12, 2015 Share Posted February 12, 2015 You're right Trap, my mistake. I revisited the document which only reflect entering into RMBS reverse call transactions. Also they mentioned growth beginning in other areas in Q2 in their conference call held late 2014. They can't purchase MSRs; I didnt see anything about holding onto originated MSRs. It seems the one of the biggest problems has been the acquisition of other servicing platforms and the lack of integration. Originating MSRs shouldnt come with these problems. Link to comment Share on other sites More sharing options...
ItsAValueTrap Posted February 12, 2015 Share Posted February 12, 2015 You're right Trap, my mistake. I revisited the document which only reflect entering into RMBS reverse call transactions. Also they mentioned growth beginning in other areas in Q2 in their conference call held late 2014. They can't purchase MSRs; I didnt see anything about holding onto originated MSRs. It seems the one of the biggest problems has been the acquisition of other servicing platforms and the lack of integration. Originating MSRs shouldnt come with these problems. They don't really want to originate subprime MSRs because of: - Reps and warranties - High servicing costs - QM rules - Weak securitization market - In the past, they originate subprime mortgages and I think they got burned on the residuals when the subprime bubble collapsed. - They don't really want prime MSRs because they might be able to make more money elsewhere. Right now they aren't doing non-QM mortgages. But they want other people to do it and to get into trouble so they can buy high-delinquency MSRs. Even for reverse mortgages / Ginnie Mae mortgages, Ocwen seems to be trying to sell off its Ginnie Mae MSRs. Link to comment Share on other sites More sharing options...
ItsAValueTrap Posted February 13, 2015 Share Posted February 13, 2015 http://www.sec.gov/Archives/edgar/data/1513161/000101359415000050/homeloandfan14a-021215.htm Mangrove Nominates A Full Slate Of Five Highly Qualified Individuals For Election To The Board Of Directors Of Home Loan Servicing Solutions, Ltd. Believes Wholesale Board Change is Needed to Protect HLSS Shareholders from Risks Related to Ocwen Loan Servicing, LLC --- So Mangrove is going activist on HLSS. I don't know if they thought things through because who will they transfer the servicing to? The banks want to get out of the business. The non-banks are afraid of getting hurt by Lawsky, who may do what he said he would do- stop the growth of nonbank servicers. A more sensible solution (in my opinion) is to use the technical default to extort money from Ocwen. Link to comment Share on other sites More sharing options...
namo Posted February 19, 2015 Share Posted February 19, 2015 The BlueMountain claims continue to deflate, it seems: http://seekingalpha.com/news/2305966-home-loan-servicing-inks-deal-with-trustee-to-rebut-hedge-fund-claims http://seekingalpha.com/pr/12552246-home-loan-servicing-solutions-ltd-signs-agreement-with-deutsche-bank-national-trust-company About HLSS & Mangrove Partners: http://www.valuewalk.com/2015/02/hill-bridge-mangrove-partners-flawed-strategy-hlss-ocn/ (Usual disclaimer: I'm not a lawyer, and I have no idea about the merits of either position.) Link to comment Share on other sites More sharing options...
Guest roark33 Posted February 23, 2015 Share Posted February 23, 2015 NRZ to buy HLSS at 18.25 per share. http://www.sec.gov/Archives/edgar/data/1513161/000151316115000011/ex991-pressreleasexfebruar.htm Interesting to see how this affects OCN and ASPS. Link to comment Share on other sites More sharing options...
yitech Posted February 23, 2015 Share Posted February 23, 2015 Ocwen Financial Intends to Sell $9.8 Billion Portfolio of Mortgage Servicing Rights to Nationstar http://uk.advfn.com/news/GLOBE/2015/article/65587192?xref=newsalerttweet&adw=1126416 Link to comment Share on other sites More sharing options...
ItsAValueTrap Posted February 23, 2015 Share Posted February 23, 2015 NRZ to buy HLSS at 18.25 per share. http://www.sec.gov/Archives/edgar/data/1513161/000151316115000011/ex991-pressreleasexfebruar.htm Interesting to see how this affects OCN and ASPS. It has a very minor benefit in that it reduces the "conflicts of interest" argument that might rack up legal bills if regulators look at them. I don't know if HLSS/NRZ will lean on Ocwen to get different terms under its contract. Link to comment Share on other sites More sharing options...
philly value Posted February 23, 2015 Share Posted February 23, 2015 What a roller coaster. Rumor spread this morning that HLSS acquisition would increase likelihood of Ocwen terminated as servicer, stock down 10%; conference call confirmed OCN will remain as servicer, stock now up 5%... Link to comment Share on other sites More sharing options...
jay21 Posted February 23, 2015 Share Posted February 23, 2015 What a roller coaster. Rumor spread this morning that HLSS acquisition would increase likelihood of Ocwen terminated as servicer, stock down 10%; conference call confirmed OCN will remain as servicer, stock now up 5%... Which call? I missed it. Link to comment Share on other sites More sharing options...
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