Mortgage servicer Ocwen Financial Corp. (OCN) posted a higher profit and record-setting revenue for the third quarter as the firm expanded its balance sheet with the acquisition of mortgage servicing rights valued at $6.1 billion of unpaid principal balance.
Ocwen posted a profit of $51.4 million, or 37 cents a share. That's up from earnings of $20.2 million, or 19 cents a share, in the third quarter of 2011.
Revenue for the period shot up 90% from last year, reaching $232.7 million.
Ocwen's book of business expanded after it acquired mortgage-servicing rights from a large bank on a non-performing subservicing portfolio valued at $1.1 billion in unpaid principal balance.
Another $2.5 billion in MSRs UPB was booked in September.
The company also acquired $2.2 billion in UPB of Fannie Mae MSRs and another $316 million UPB of MSRs from both GSEs in July.
One of the more highlighted transactions recorded in the third-quarter was Ocwen's winning bid in partnership with Walter Investment Corp. (WAC) to acquire mortgage servicing and origination assets from former Ally Financial subsidiary Residential Capital out of bankruptcy. The firms acquired the MSRs and assets for a purchase price of $3 billion. Once approved by the bankruptcy court, Ocwen will end up with $126.6 billion of UPB in MSRs and $31 billion of UPB in subservicing rights.
Ocwen expanded its footprint further in the mortgage space this week, announcing the acquisition of Genworth Financial Equity Access for $22 million. The reverse mortgage originator was acquired from its parent firm, Genworth Financial Corp (GFI).