Nationstar Mortgage to Buy ~$215B in MSRs

Nationstar Mortgage Holdings Inc. (NYSE: NSM) (“Nationstar”) announced todaythat Nationstar Mortgage LLC, a wholly-owned subsidiary, has signed adefinitive agreement to acquire approximately $215 billion in residentialmortgage servicing rights (“MSRs”), as measured by unpaid principal balance(“UPB”) as of November 30, 2012, and certain other assets from Bank ofAmerica.Approximately 47% of the servicing portfolio, as measured by UPB, consists ofloans that are owned, insured or guaranteed by Fannie Mae, Freddie Mac, andGinnie Mae, with approximately 53% of the portfolio consisting of loans inprivate-label securitizations. With this transaction, Nationstar anticipatesadding more than 1.3 million customers to an existing customer base of 1.2million. Nationstar's total servicing portfolio is approximately $425 billion,pro-forma for this transaction plus an additional $13 billion Bank of Americagovernment servicing portfolio acquisition that closed in Q4 2012 andNationstar's UPB as of September 30, 2012.The purchase price for the mortgage servicing rights is approximately $1.3billion. The MSR portfolio purchases will close as investor and otherthird-party approvals are received, which Nationstar expects the majority tooccur in Q1 2013. In addition to the MSRs, Nationstar will also be acquiringapproximately $5.8 billion in related servicing advance receivables as theassociated portfolios are boarded during 2013. Nationstar expects to enterinto third-party financing agreements to fund the servicing advances.