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51 » VISIT US ONLINE @ DSNEWS.COM POWELL PROMISES 'THOROUGH' REVIEW OF BB&T, SUNTRUST MERGER Jerome Powell, Chairman of the Federal Reserve told the Senate Banking Commit- tee that the Fed would carry out "thorough and transparent" review of the recent BB&T/ SunTrust merger before giving it a go-ahead. In February, BB&T and SunTrust an- nounced a merger valued at $66 billion that would create the sixth-largest U.S. bank based on assets and deposits, making it the biggest bank deal since the 2007-2009 financial crisis. e merger, which is expected to get completed by the end of Q 4 2019 will create an entity whose footprint will cover the East Coast with new corporate headquarters in Charlotte, North Carolina. In terms of its revenue from the mortgage business, the banks projected the combined fee income of the merged entity at $88 billion with 7 percent coming in through residential mortgage banking. Answering a question on the criteria for evaluating bank merger applications, he said that a section of law under the Federal Reserve Act laid out plenty of guidance and detail on the issue. Some of the factors that the Fed considered while evaluating such mergers included, competitive and banking community factors, managerial resources, compliance with consumer fair lending laws and the Community Reinvestment Act (CRA), as well as the combined financials of both the companies. "We also invite public comment. We have a pretty thoroughly worked out process to work through the merger and then we make a decision," Powell told the committee while pointing out that the number of mergers between banks was the lowest "in at least 15 years" in 2018. Answering a question on how the Fed would look at the BB&T/SunTrust merger during his testimony before the Senate Banking Committee, Powell had said that the process for evaluation was set forth in great detail. "We will go through that process carefully, fairly, thoroughly, and with a lot of transparency," he said answering a question on the merger from Ranking Member Sen. Sherrod Brown while acknowledging that the Fed had still not received the merger application. He also replied to a question on how the Fed would evaluate the merger based on the banks' individual CRA ratings given by the Office of the Comptroller of Currency (OCC). "We haven't changed our policy [on studying recent and past CRA violations], and we do consider the law under conve- nience and needs of the communities served and that includes consumer compliance and fair lending records, and the record of perfor- mance under the CRA," Powell said. Additionally, he said that the Fed would also consider public comments and the full range of information given to them. "Any information that's presented to us, we'll also consider," he said. OCWEN LEADERSHIP HIGHLIGHTS PROGRESS WITH Q4 REPORT In its latest financial report, Ocwen Fi- nancial Corporation noted a fiscal improve- ment of $57.2 million in Q2 2018, despite a net loss of $70.8 million for 2018 it's up from a net loss of $128.0 million for 2017. Glen Messina, CEO Ocwen, said, "We made solid progress in the quarter as we work to realize the scale and cost savings benefits of combining Ocwen and PHH and position the company for future profitability. We are focused on executing our key business initiatives in order to address our most critical near-term business challenges, improve our financial performance, and establish a stron- ger foundation for the future. We continue with our disciplined and prudent approach to our integration efforts and are encouraged by the overall progress we are making." e company completed 39,545 loan modi- fications in 2018 which included 17 percent or $200 million in debt forgiveness. Primarily driven by acquisition of the lower delinquency PHH portfolio and ongoing consumer as- sistance efforts, delinquencies decreased from 7.8 percent in September 2018, to 4.9 percent in December. e constant prepayment rate decreased from 13.7 percent in the third quarter of 2018 to 12.9 percent in the fourth quarter of 2018. e company also reported that the prime CPR in Q 4 2018 was 14.8 percent, and the non-prime CPR was 11.8 percent. For the full year 2018, the company originated forward and reverse mortgage loans with an unpaid principal balance of $0.9 billion and $0.6 bil- lion, respectively, with a mortgage portfolio estimated at $68.1 million in discounted future gains from future draws on existing loans. e company is also optimistically looking ahead, with new leadership roles announced—just a few months after Messina took the reigns. Ocwen announced that June C. Campbell will officially take over as the new CFO on March 4, 2019, in addition, Jo- seph J. Samarias will assume the role of EVP and General Counsel, effective April 1, 2019. Campbell joins Ocwen from GE Capital, where she held multiple senior management positions in Finance, Capital Markets and Operations during her more than 20-year career at the company. Messina stated, "I look forward to her being an integral member of our management team to help drive long- term success for Ocwen." Samarias who has been with the company since 2013 and currently serves as SVP and Deputy General Counsel of Litigation and Government Af- fairs, and Chief Ethics Officer.

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