BB&T to Aquire Bank Atlantic
In a marriage of the 11th and 12th largest banks in Palm Beach County, BankAtlantic said today it will be bought by BB&T Corp.
Fort Lauderdale-based BankAtlantic Bancorp (NYSE: BBX) is the No. 11 bank in the county, with $929 million in deposits. BB&T (NYSE: BBT) of Winston-Salem, N.C., is No. 12, with $744 million in deposits.
BankAtlantic's $3.8 billion in assets make it the seventh-largest Florida-based bank.
BB&T said it will take on $2.1 billion in loans and assume $3.3 billion in deposits from BankAtlantic. BB&T will pay a $301 million premium.
Fannie Mae Monday morning confirmed to National Mortgage News that its multifamily unit is the subject of an Inspector General probe being conducted by the Federal Housing Finance Agency.
Moreover, NMN has learned that Fannie Mae's chief risk officer in charge of multifamily mortgages, David Worley, departed from the secondary market giant Monday morning.
A spokeswoman for the GSE declined to say whether Worley's departure is related to the IG probe.
“Fannie Mae was advised by FHFA and the Office of Inspector General that the OIG is conducting an investigation of a transaction in our Multi-Family business,” it said in a statement. “The investigation is limited in scope and we are cooperating fully with
FHFA and the OIG. Consistent with our usual practice, we placed employees on administrative leave pending the outcome of the review."
A call to Fannie's switchboard in Washington revealed that Worley is no longer in the company's database. No residential phone number was available for him in the Washington area.
As the head of multifamily mortgage risk, Worley oversees underwriting standards and related areas for Fannie. According to company figures, the delinquency rates on the GSE's MF portfolio have been declining since late last year.
A spokeswoman for the Federal Housing Finance Agency said she had no information concerning Worley and referred calls to the IG's office, which did not return them.
Worley joined Fannie in 2005 from Senderra Capital and First City Partners. Senderra had ties to Senderra Funding, a subprime lender controlled by Goldman Sachs.
State and federal regulators shuttered
All American Bank in Des Plaines, Illinois, over the weekend, bringing this year’s
failed-bank tally to 85.
All American Bank operated just one branch location, with $33.4 million in deposits and assets totaling $37.8 million. The
FDIC brokered a deal with
International Bank of Chicago to take over the failed lender’s operations and purchase all of its assets.
The FDIC estimates that the Illinois bank’s closing will cost its Deposit Insurance Fund $6.5 million. All American Bank is the ninth FDIC-insured institution in the state to go under this year.
The chairman of the House subcommittee responsible for matters related to the nation’s two largest mortgage financiers unveiled his plan Thursday for reforming the secondary mortgage market and winding down
Fannie Mae and
Rep. Scott Garrett (R-New Jersey) leads the Financial Services Subcommittee on Capital Markets and Government-Sponsored Enterprises. According to Garrett, there’s no question that the GSEs should cease
to exist, and he says it’s time to put a plan into place to ensure private investors are ready to take up the slack once they’re gone.
Garrett stressed that government guarantees for mortgages have forced taxpayers to foot the bill for massive bailouts. Estimates released Thursday indicate Fannie and Freddie could require as much as $311 billion by the end of 2014. Private investment, according
to Garrett, will protect U.S. taxpayers from such dues.
“The government-sanctioned duopoly of Fannie and Freddie is not only systemically dangerous to our economic security, it’s un-American,” Garrett said in a statement. “For too long the government’s manipulation of the housing market has crowded out private
market participants at the expense of the American taxpayers.”
The House lawmaker has outlined a three-part plan. First, he says the
Federal Housing Finance Agency (FHFA) must standardize mortgage securitization by creating specific categories of mortgages with consistent underwriting requirements for each, and developing uniform securitization agreements
and representations and warranties.
Garrett says FHFA should streamline the process for securities that meet the defined underwriting characteristics and use the standard agreements. His last directive under the standardization point is likely to draw the most ire:
abolish the risk-retention provisions included in Dodd-Frank.
Secondly, Garrett says secondary market players must “ensure rule of law and legal certainty” by removing conflicts of interest between servicers and investors, clarifying rules around second lien mortgage obligations, and mandating arbitration between investors
and issuers for all rep and warranty disagreements.
Regulators cannot unilaterally force investors to reduce the principal of loans they’ve invested in, according to Garrett, and servicers’ accounting and reporting procedures must be standardized for all loan restructurings, modifications, or workouts. Both
of which will support legal certainty for private investors, Garrett says.
The third part of Garrett’s plan calls for additional transparency and disclosures. He says the quality of loan level data and other information used by investors to evaluate the value of mortgages must be improved. Garrett also wants investors to be privy
to pricing history on securitization deals, and he advocates for the creation of individualized markers to distinguish each loan within a pool.
Garrett says 95 percent of the mortgage market is in the hands of the government right now, taking into account the position of the two GSEs as well as the
Federal Housing Administration. With such skewed government vs. private sector participation, “we haven’t fixed anything,” Garrett said on CNBC’s “Squawk Box” program Thursday.
Garrett expects his plan to pave the way for less government and more private involvement in the mortgage marketplace, but it’s exactly this disproportionate allocation of financial support that leads some in the industry to err on the side of caution in
mapping out the future of the nation’s housing finance system.
“The GSEs will, in the short term, continue to play a vital role in terms of providing liquidity to the marketplace,” commented Ed Delgado,
CEO of the
Five Star Institute. “Any abrupt action can be detrimental to the financial markets and signal more uncertainty.”
Together, Fannie Mae and Freddie Mac provide more than $5.7 trillion in funding for the U.S. mortgage markets and financial institutions. Those are the latest figures from the federal government.
“You have to measure the deconstruction of the GSEs relative to the impact on the housing and national economy. We’re not just shutting off a light switch,” Delgado says.
*Editor’s Note: The Five Star Institute is the parent company of DS News and DSNews.com.