Florida-based Ocwen Financial Corporation, a financial services holding company which services and originates loans through its subsidies, released its operating results for Q2 2018.
The numbers reflected a GAAP loss of $29.8 million, compared to a net loss of $44 million, a $14.7 million improvement, according to Ocwen’s statement. The company generated “revenue of $253.6 million and cash flows from operating activities of $97.2 million for the three months ended June 30, 2018, and ended the quarter with $228.4 million of cash.”
Despite these losses, Ocwen CEO John Britti states that Ocwen has remained focused on helping homeowners, resolving legacy regulatory and legal matters, and investing excess cash and preparing for its merger with PHH, an acquisition that was announced in February of this year.
“We have made progress in all four areas,” Britti said. “Ocwen completed 10,752 modifications to help homeowners stay in their homes while providing loan investors better outcomes than foreclosure. Regarding legacy regulatory and legal matters, we believe that as a result of court rulings, settlements, and ongoing negotiations, we are continuing to make progress on this front.”
Ocwen recorded pre-tax losses at $28.4 million, a $13.2 million improvement in a year-over-year analysis, with the servicing segment recording $2.1 million of pre-tax income, the Lending segment recordeding $1.4 million of pre-tax income, its reverse mortgage lending business recording $3.1 million of pre-tax income, and the forward lending recapture business suffering a $1.7 million pre-tax loss.
Additionally, the Corporate segment recorded a $31.9 million pre-tax loss, which was “primarily driven by $13.4 million of corporate interest expense, $7.4 million of ongoing strategic transaction, and restructuring costs and $5.3 million of CFPB and state regulatory related legal fees and other expenses.”
"Our primary emphasis, however, has been on developing our plans for integration upon closing of our merger with PHH," Britti said. "We have made solid progress towards closing the transaction, and we are currently targeting closing the acquisition in the third quarter of 2018. Our integration planning has progressed sufficiently for us to revise our annual synergy run-rate target up to $100 million over annualized Q2 2018 operating expenses for both companies combined."