24 January 2018
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Barclays to acquire HomEq unit from Wachoiva

23 June 2006  |  4578 views  |  0 Source: Barclays Bank

Barclays Bank PLC (Barclays) announces that it has entered into an agreement to purchase the US mortgage servicing business of HomEq Servicing Corporation (HomEq) from Wachovia Corporation (Wachovia) for a consideration of $469 million.

This consideration represents net book value for the mortgage servicing rights (MSR) and fixed assets, and $209 million in respect of advances, the collection of which is fully indemnified by Wachovia. The consideration is subject to an adjustment mechanism based on the value of the MSR and advances at completion of the transaction. Completion is subject to various conditions including regulatory consents. Barclays will finance the transaction out of existing cash resources.

This transaction will add further capabilities to Barclays Capital's growing mortgage securitization franchise in the US. Barclays Capital, the firm's investment banking division, has an active and successful whole loan mortgage business in the US which involves the purchase and securitization of mortgages on a principal basis.

Grant Kvalheim, Co-President of Barclays Capital, commented, "This is a great opportunity for Barclays Capital to add an additional first-class operation to its US business. This transaction will enable us to grow our existing US mortgage securitization franchise. It will improve our ability to price deals, manage risk and expand our list of counterparties."

"HomEq has built a reputation in the industry for high quality operations and great execution," said Robert V. Burton, head of Wachovia's Retail Credit Businesses and Products division. "We are confident that this transaction positions HomEq well for the future."

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