Wachovia Shutters EquiBanc
Housing Wire has learned that Wachovia shut down its only non-conforming lender, EquiBanc Mortgage Corporation, late last week. According to a statement posted on the company's web site, Wachovia decided to exit its subprime loan origination business after a "strategic review" of the company's lending operations. Wachovia has been moving quickly to lessen its exposure to the subprime mortgage credit sector, selling its HomEq servicing platform to Barclays Capital for $469 million last November. The closing of EquiBanc was widely expected after the transaction, although Wachovia did not comment on its future plans for the operation after shedding HomEq. Wachovia is set to announce earnings for 2006 early Tuesday, with many industry insiders curious to see if the results of the bank's mortgage business will mirror those of Washington Mutual, which reported a $122 million fourth quarter loss on its mortgage operations. EquiBanc was not a new comer to the subprime sector, having started operations in 1996. The now-defunct subprime lender processed loans primarily in Georgia, Florida, and Tennessee, although it operated in numerous other states as well.