Ocwen Financial Corporation (NYSE:OCN), parent company of PHH Mortgage Corporation and its wholly-owned subsidiary Liberty Reverse Mortgage, announced this week that it will be holding its annual meeting of shareholders on May 25, 2022 at 9:00am EST. In its announcement, the company provides details on its financial performance over the past year and offers positive perspectives about the specific performance of its reverse mortgage business, according to a filing with the Securities and Exchange Commission (SEC).
Ocwen is committed to further diversifying its portfolio, a commitment which was emphasized in two key acquisitions made in 2021, the filing reads.
“Ocwen completed two key acquisitions in 2021 to further strengthen and diversify its originations and servicing platforms: the Company acquired Texas Capital Bank’s correspondent lending business in June 2021 and Reverse Mortgage Solutions, Inc’s reverse servicing platform in October 2021,” the filing says.
RMS purchase a ‘highlight’ for Ocwen in 2021
The acquisition of the Reverse Mortgage Solutions (RMS) servicing platform was also emphasized as a key business highlight for Ocwen in the previous year.
“[The company] closed the acquisition of Reverse Mortgage Solutions, Inc. reverse mortgage servicing platform, roughly doubling our reverse mortgage servicing portfolio, becoming the only end-to-end reverse mortgage provider in the industry, and creating a reverse subservicing platform,” the company said.
The filing also offered reverse-related business as reasons for the accomplishments of its executive team, including for CEO Glen Messina, EVP and Chief Servicing Officer Scott Anderson, EVP and Chief Growth Officer George Henley and Chief Administrative Officer Dennis Zeleny.
While Messina is credited with directing diversified investments which include reverse mortgage business, Zeleny is the executive with the most reverse-related accomplishments on the executive team according to the document.
“[Zeleny] selivered double-digit growth in forward and reverse originations, and improved refinance recapture rates,” the document says. “[He also] integrated correspondent lending business acquired from Texas Capital Bank, and restructured the correspondent sales team to an enterprise-wide sales model to increase our coverage of forward, reverse, and commercial channels.”
Zeleny also “exceeded quality targets, or defect rates” across recapture and reverse channels; and helped to improve net promoter scores in consumer-direct and reverse wholesale segments, the document says.
Earlier this year, Ocwen announced that in full year 2021 it had posted its first annual profit since 2013 but a slide in earnings in the fourth quarter. The company also sees its current and future interests in the reverse mortgage business through Liberty and its acquisition of RMS as a critical factor in its operations.
Ocwen confidence in subservicing portfolio bolstered by RMS purchase
Particularly the acquisition of RMS appears to have bolstered the company’s confidence in its total sub-servicing portfolio, and the company described favorable conditions in its originations business particularly when it comes to Liberty in comparison with its forward mortgage portfolio in its full-year results earnings call.
“We’re excited about our reverse sub-servicing platform,” said Ocwen Chief Financial Officer June Campbell on the earnings call. “It uniquely positions our reverse servicing business for accelerated growth this year. [W]e expect $11 million in higher reverse mortgage revenue from boarded and committed volume this year, $25 billion of the $27 billion in UPB are under a five-year sub-servicing agreement. With scale and optimized cost structure, we expect the acquisition to be accretive to our reverse servicing business in the second half of the year, achieving $5 million in adjusted pre-tax income by the fourth quarter.”
Ocwen announced the acquisition of RMS in June, 2021 in a deal valued at approximately $12.4 million. The deal was closed a few months later in October, 2021. Shortly after the purchase, RMD sat down with Liberty President Mike Kent, who described what the purchase of the RMS servicing platform will do for the lender’s ability to serve its reverse mortgage customers.
“[This sale] affords us the ability and opportunity to deliver end-to-end superior and consistent customer service to our borrowers and partners,” Kent told RMD in June, 2021. “PHH/Liberty is a customer-centric organization. Our goal is to always see our service offering through the lens of our customers and continually strive to deliver solutions to meet their needs. Aligning our origination business with our reverse servicing business will make possible better retirement outcomes for our borrowers.”