""Ally Bank"":http://www.ally.com/, a subsidiary of Ally Financial, announced an agreement Tuesday to sell mortgage servicing rights (MSRs) to ""Ocwen Financial Corporation"":http://www.ocwen.com/ for $585 million.[IMAGE]
The transaction includes MSRs with an unpaid principal balance of $85 billion and another $5 billion in agency MSRs created based on commitments made through the end of February, according to a company release. The sale also includes representation and warranty liabilities for the majority of the loans sold.[COLUMN_BREAK]
In addition, the agreement gives Ally the right to sell its remaining MSR portfolio, which exceeds $30 billion, to Ocwen in a later closing.
""Ally continues to make significant progress in exiting its non-strategic mortgage activities. Going forward, the Bank's full focus and resources will be centered on its leading direct banking franchise and advancing its customer-centric deposit activities, as well as continuing to grow its key role in Ally's auto finance operation,"" said Barbara Yastine, president and CEO of Ally Bank.
The transaction is subject to approval by Fannie Mae and Freddie Mac.
Ally Bank also completed the ""sale"":http://dsnews.comarticles/walter-investment-to-acquire-allys-lending-business-2013-02-18 of its business lending operations to Walter Investment Management Corp.
In May 2012, Ally's mortgage arm, Residential Capital, ""filed"":http://dsnews.comarticles/allys-mortgage-unit-files-for-bankruptcy-new-strategies-announced-2012-05-14 for bankruptcy. Ally has been working toward shedding its mortgage operations after suffering major losses from its subprime business. During the financial crisis, Ally received taxpayer bailout funds totaling $17.2 billion. Currently, taxpayers own 74 percent of Ally.