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Tag Archives: Barclays Capital

Barclays Loses Two More in LIBOR Scandal Backlash

Only one day after chairman Marcus Agius announced his resignation, Barclays announced that director and CEO Bob Diamond and COO Jerry del Missier are both stepping down. The resignations were announced Tuesday morning and are effective immediately. The wave of resignations is brought on by a scandal last week, when it was revealed that Barclays had manipulated the London Interbank Offering Rate (Libor). Agius will lead the search for a new CEO and will be supported by deputy chairman Michael Rake.

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Barclays Chairman Steps Down Amid Scandal

Barclays released a statement Monday morning announcing that chairman Marcus Agius is stepping down in the wake of a scandal that rocked the bank. This follows news from last week that Barclays had manipulated interbank lending rates starting as early as 2007. Barclays was fined £290 million (approximately $450 million) by British and U.S. authorities for manipulating the London Interbank Offered Rate. The Barclays board will commence the search for a successor immediately. Agius will remain in post until a successor is found.

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Barclays Advocates Short Sales to Lower Loss Severities

With vacant homes stretching the capacity of banks' balance sheets and homebuyer demand lackluster at best, short sales are becoming a top loss mitigation choice for private lenders and investors, particularly in especially hard-hit markets. According to Barclays Capital, the benefits of pursuing a short sale are compelling for servicers and investors who are able to liquidate delinquent loans in an expedited fashion with fewer payment and interest (P&I) advances and who take ""quasi"" possession of the property in better condition and at better prices than REO, lowering severities.

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Fannie Mae Removes ‘Ability to Repay’ from HARP 2.0 Guidelines

Fannie Mae has updated its Selling Guide to reflect the recently announced changes to the Home Affordable Refinance Program (HARP). Most of the revisions were previously disclosed in November, but there's one nuance that stands out. Fannie Mae has removed the ""reasonable ability to repay"" clause from the criteria for vetting borrowers for a new HARP loan. Analysts say the subjective ability-to-pay requirement was one of the significant hurdles to HARP refinancing.

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HARP’s Rep and Warranty Waiver: Will It Spark a Refinancing Frenzy?

With the Federal Housing Finance Agency's (FHFA) retooling of the Home Affordable Refinance Program (HARP), one change in particular may hold the answer to just how much of an impact the initiative will have -- FHFA's decision to waive representations and warranties on loans that are refinanced through the program. The debate has already begun about whether such a move will indeed persuade lenders to step up participation in the program. Some lenders do see it as an opportunity, but market analysts say the rep and warranty waiver may be less effective than expected.

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Barclays Expects ‘Triple-Dip’ With Another 7% Drop in Home Prices

The analysts at Barclays Capital say a ""triple-dip"" in home prices will likely materialize by early next year. The term ""triple-dip"" emerged in a Clear Capital report a couple of weeks ago, and Barclays says its analysis corroborates the idea. The research firm warns that home prices will likely slip another 6 to 7 percent over the coming winter months. That would put median prices at a new low for this cycle, in fact 3 percent below the double-dip measurement of last spring.

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Banks’ REO Inventories Down by 17%

Banks held about 476,000 homes that they repossessed from delinquent mortgage borrowers as of the end of July, according to Barclays Capital. That tally represents a 17 percent contraction from 574,000 REOs on the books just 10 months earlier, in September of 2010, just as the robo-signing scandal began grabbing headlines. According to Barclays' analysis, the average number of months a loan has spent in foreclosure has climbed from around 10 months just before October of last year to more than 12 months today.

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Industry Calls for Less GSE Action, More Investor Protection

At a congressional hearing Wednesday, witnesses voiced concerns about the government's participation in the mortgage market as well as the lack of transparency between servicers and investors. One analyst described the U.S. housing finance system, where the GSEs account for over 90 percent of new mortgages, as ""problematic."" Others said government is crowding out the private market with programs that make below-market-rate loans available to nearly all borrowers, and they advocated for the expiration of increased conforming loan limits.

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U.S. Downgrade: How Will It Impact Housing Fundamentals?

Congress' last-minute accord to avert a default wasn't enough to save the United States' top rating from Standard & Poor's. The agency downgraded the long-term credit rating of the U.S. to AA+, a grade just below the AAA rating the U.S. had held for 70 years. Analysts were expecting a temporary spike in Treasury yields, which are closely tied to mortgage rate trajectories, but investors responded with a rush on Treasuries, pushing yields down 13 basis points. Fannie Mae, Freddie Mac, and the Federal Home Loan Banks also had their S&P ratings lowered to AA+ on Monday.

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Auction.com Hosts Sale of Texas Commercial Real Estate

Auction.com is in the midst of a three-day online auction of Texas commercial real estate properties and nonperforming notes. The company says in total, the assets up for sale are valued at more than $300 million, making it the largest conglomerate of commercial real estate assets to be auctioned online in Texas history. Barclays Capital matched the list of assets to be sold to its database of commercial mortgage-backed securities (CMBS). The firm pegs CMBS exposure to the Texas auction at about $262.5 million.

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