Ocwen Financial narrows 3Q loss, servicing revenue up 51%
Ocwen Financial (OCN) narrowed its third-quarter loss, as mortgage servicing performed better this year and the year-ago quarter was hurt by a $56.5 million tax expense. The South Florida-based loan servicing firm reported a loss for the three months ended Sept. 30 of $8.8 million, or 9 cents a share, including $33.9 million in costs related to the acquisition of HomEq and $20.1 million in litigation charges stemming from a judgment in a case with Cartel Asset Management. For the year earlier third quarter, Ocwen reported a loss of $42 million, or 51 cents a share, including the tax expense and other charges. Third-quarter revenue rose about 13.5% to $96.6 million from $84.2 million a year ago. The total unpaid principal balance in the company's servicing portfolio during the quarter rose to $76.1 billion from $40.3 billion a year earlier. Servicing revenue for the quarter rose 51% to $95.3 million from about $63 million a year ago. "The delinquency rate on the Saxon portfolio has started to decline, contributing to a decrease in Ocwen's advances on the Saxon portfolio by $47 million during the third quarter," said Ronald Faris, president and chief executive. "We expect advances to decline further as we bring the performance of the Saxon and HomEq portfolios more in line with similar loans in Ocwen's legacy portfolio." The company ended the quarter with cash and available credit of $312.6 million. For the nine months ended Sept. 30, Ocwen earned $28.1 million or 27 cents share, on total revenue of $247.1 million. The company reported a loss of $9.1 million, or 13 cents a share, on revenue of $308 million a year ago. Write to Jason Philyaw.