MortgageReverse

Parent Company of Reverse Mortgage Lender Hit With C&D From Regulators

image First Mariner Bancorp, the parent company of First Mariner bank disclosed in a SEC filing on Monday that it had entered into an agreement with banking regulators requiring it to boost capital levels, improve earnings and reduce problem loans. 

In a statement issued Monday, First Mariner said its management and board of directors had already taken action to address the FDIC’s concerns, even before entering into the cease and desist order Friday.

“[First] Mariner is working in complete cooperation with regulators and expects to satisfy all of the requirements of the order,” the bank said in a statement. “The bank continues to pursue plans to increase its capitalization through a combination of capital-raising efforts, which include conventional efforts in public and private markets as well as the sale of assets.”

Next Generation Financial Services (NGFS), a leading reverse mortgage lender is a division of First Mariner Bank.  The company has endorsed 550 HECM YTD according to data from Reverse Market Insight.

According to people I spoke with at  NGFS, it’s business as usual for the company. 

Update: Thursday afternoon, NGFS President Brett Carter sent an email to employees regarding the C&D which stated:

As many of you know, earlier this week First Mariner Bank (the "Bank")
announced that it had agreed with the Federal Deposit Insurance Corporation (the "FDIC") to the entry of an FDIC Cease and Desist order, dated September 18, 2009 (the "Order").  Pursuant to the Order, the Bank is required, among other things, to repair the Bank’s capital position, improve earnings and reduce the Bank’s exposure to nonperforming loans.  The Bank has deadlines to achieve improvement in its capital position and loan portfolio, the
earliest of which is March 31, 2010.

We at NGFS take this development seriously, and we intend to monitor the Bank’s progress in complying with the Order.  As necessary, we will take action to ensure that the Bank’s situation does not negatively affect NGFS.

Finally, issuance of the Order does not affect our near term or long term plans for NGFS.  We will continue to aggressively grow our distribution capacity.

Best regards.

Brett Carter

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