Mergers and acquisitions valued at $811.8 billion have been announced this quarter globally, up 21% compared with Q1 of 2014, according to Thomson Reuters' data. For some companies the deal activity in the first quarter was driven by continuing cash accumulation at companies, CEO confidence, inexpensive debt financing and pressure from activist shareholders. For many banks and lenders it is simply the cost of doing business.

Seacoast National Bank ($3.1B, FL) will acquire Grand Bank & Trust of Florida ($208mm, FL) for about $16.2mm in cash and stock or roughly 1.2x tangible book. SBM Financial, Inc. (Gardiner, ME) has agreed to merge with Camden National Corporation (Camden, ME).  The Federal Savings Bank is pleased to announce that it has completed the previously announced merger with Baytree National Bank & Trust Company (Baytree) located in Lake Forest, IL. The merger results in an institution with total assets of $270 Million. The transaction had been awaiting regulatory approval, which now has been received. In Big Sky Country First Interstate Bank ($8.6B, MT) will acquire United Bank ($75mm, MT) for $7.2mm in cash.

In Maryland (state motto: "If it weren't for Washington, you couldn't find us") 1880 Bank ($192mm) will acquire Easton Bank & Trust ($133mm) for $8mm in cash. In Illinois Wintrust Financial ($20.1B) will acquire North Bank ($108mm) for $17mm in cash. CertusBank ($1.5B, SC) will sell a branch in NC to Aquesta Bank ($264mm, NC) and a branch in NC to Communityone Bank ($2.2B, NC). (After the sales, Certus will exit the state.) Mohave State Bank ($317mm, AZ) will sell a branch in AZ to 1st Bank Yuma ($215mm, AZ) for a deposit premium of 4.45%. The branch has about $17mm in deposits and $18mm in loans. Sun National Bank ($2.7B, NJ) will sell a branch in NJ to Cape Bank ($1.1B, NJ) for a deposit premium of 4.0%. The branch has $34.1mm in deposits and $4.9mm in loans. Sun National said it also intends to consolidate 9 branches into other locations, as it seeks realigns its branch network following evaluation of market growth potential, cost efficiencies and other factors.

In the armadillo state Texas Bank and Trust Co. ($2.0B) will acquire Vision Bank - Texas ($180mm). The Camden National Bank ($2.8B, NE) will acquire The Bank of Maine ($806mm, ME) for $135mm in cash and in stock. And because I haven't written about a Louisiana bank buying Texas branches from a bank in Mississippi, Community Trust Bank ($3.7B, LA) will acquire 4 branches in Houston, TX from Whitney Bank ($20.6B, MS). The branches reportedly have $106mm in deposits and $15mm in loans. Atlantic Capital Bank ($1.3B, GA) will acquire FSGBANK ($1.1B, TN) for $160mm in cash and stock. Truliant Federal Credit Union ($1.8B, NC) said it will open 10 branches and hire 120 employees in Charlotte, NC by the end of 2016.

In mortgage banking-land, Olympia Capital Management, Inc. announced that its client - AMT Holdings - is acquiring Odyssey Funding, LLC, a NY based mortgage company. Odyssey is licensed in eleven states and is a full service mortgage banker.

Home Point Financial Corporation a mortgage banking and financial services company, has announced the acquisition of Maverick Funding Corp.  Maverick's business will serve as Home Point Financial's initial mortgage banking platform. "With 30 retail branches across 10 states and a national third party lending operation, Maverick originated over $3 billion of residential mortgages since 2012. Maverick's founders, Ralph Vitiello and Mike Petruccelli, will remain with the company and serve as senior executives focused on the continued growth of the origination network." (The release notes that "Home Point Financial is a nationwide mortgage banking business focused on multi-channel residential mortgage origination and servicing. Home Point Financial is a subsidiary of Home Point Capital LP, a financial services holding company founded in 2014 and owned by members of management and by investment funds managed by Stone Point Capital LLC.")

The delinquency rate for loans on one-to-four unit residential properties dropped to a seasonally adjusted rate of 5.68 percent, the lowest level since Q3 of 2007. According to the MBA's fourth quarter 2014 National Delinquency Survey, mortgage delinquencies are continuing to decline. The delinquency rate decreased 17 basis points from the previous quarter and 71 basis points from a year earlier. The delinquency rates include loans that are at least one payment past due but does not include loans in the foreclosure process. The amount of loans in the process of foreclosure at the end of 2014 was 2.27 percent, a 12 basis point drop from the third quarter in 2014. The serious delinquency rate, where loans are more than 90 days past due or in the process of foreclosure, was 4.52 percent, a 13 basis point decline from the previous quarter.

Richey May & Co. has released its fourth quarter 2014 Trend Report for Independent Mortgage Bankers. The Trend Report includes the operating results of more than 40 independent mortgage companies throughout the United States and covers all operating models and production volumes.  According to the report, the 4th quarter of 2014 was representative of the year as a whole, with "decent production and good margins, but minimal pre-tax profits."  During Q4, total production increased 3.9 percent over Q3, gross loan margins were up by 4.3 basis points (bps) and pre-tax profits shrank by 28.4 bps.  Purchase volume decreased by a modest 6 percent over the previous quarter and refinance volume increased to 28.4 percent of overall volume due to declining interest rates. Per-loan operating expenses increased during the 4th quarter after declining over the first three quarters of the year, averaging $1,873 per loan for the full year 2014, causing the dip in profits, noted Kenneth Richey, managing partner of Richey May.  "With production volume and margins both up during the 4th quarter, the increase in operating expenses on a per-loan basis is less an indication of overcapacity and more a result of lenders making needed investments in technology and infrastructure," Richey observed.  "Expenditures like these typically precede any increase in production by at least a quarter."

KBW Research recently released the mortgage banking summary of fourth quarter 2014. KBW Research tracks earnings from Wells Fargo, J.P Morgan Chase, Bank of America, Citi, BB&T, PNC Financial, SunTrust, U.S. Bank and Fifth Third Bank. The report indicated that banking revenues have increased due to higher gain-on-sale margins. Mortgage volumes were down 4% QoQ and 6.2% YoY.  Mortgage applications were up going into the first quarter of 2015. Gain-on-sale margins grew 9 bps (4.8%) and only Wells Fargo and U.S Bank reported lower margins. The low interest rate environment the past few months may be responsible for the positive gain-on-sale margins. Mortgage servicing rights valuations were also down due to low interest rates. Overall, the mortgage results for the banks that have reported their fourth quarter earnings were better than originally anticipated.

Altisource's Owners.com has announced the top 20 "for sale by owner (FSBO)" markets, where consumers have sold their homes using the MLS model in 2014. The best self-directed real estate markets include New York at the top of the list with an average list price of $496,576, followed by Chicago, Tampa-St. Petersburg-Sarasota, Dallas-Ft. Worth and Philadelphia. FSBO's allow for individuals to sell and buy homes without having to utilize full service real estate professionals, resulting in more transparency, accessibility and savings. According to Owners.com, 2014 was a high-growth year for self-directed real estate sales and sellers saved about $9,500 in commissions through selling their homes on Owners.com. Ever changing technology has allowed more consumers to take the selling process into their own hands resulting in monetary savings.

Risks in the lending market? There might be a few. Wells Fargo writes, "Stronger economic growth and improvement in household and corporate balance sheets have encouraged banks to ease lending standards in recent years...credit growth has expanded rapidly, which in turn has boosted spending and investment. However, as the Fed begins to raise interest rates later this year, will households and corporations find themselves overleveraged? If so, which loan categories pose the most risk?" Wells addresses an important topic, that is, in a rising rate environment is all risk exposure the same? The short answer: it's not.

Rates stepped higher yesterday for a variety of reasons. Jobless Claims fell by 20k, and are near their lowest level in 15 years. The four-week moving average for claims, which evens out weekly volatility, fell by 14,750 to 285,500 last week. The trade gap narrowed in February to 5 year low - mostly due to oil imports: the deficit for petroleum products fell to $8.1 billion, its lowest level since July 2002. On the flip side Factory Orders rose in February for first time in 6 months. But that wasn't enough to take the focus off of the jobs market.

On the international front Iran has reached a deal with global powers that will, among other things, give them three more months to hash out an agreement. Apparently our own Congress isn't the only body that is good at kicking the can down the road (see "yearly budget crisis".) Oil rallied following the announcement by President Obama, although it remained down on the day. The yield on the 10-year moved higher to close at 1.90% and current coupon agency MBS prices worsened about .250 resulting in some intra-day price changes.

But today, with its 9AM PST bond market close, is a new day and we have the March employment numbers to guide us. Nonfarm Payroll came in at 126k - much lower than expected with revisions taking 69k off previous months, the Unemployment Rate at 5.5%, and Hourly Earnings were higher. On the weak news the 10-yr is down to 1.83% and agency MBS prices are better by .250-.500, depending on coupon.

Spring is here, right? Lots of folks are married in the spring, and for others it is time to propose. Stores, intersections, airports, hotels, gas stations, office buildings now have cameras, why not ring boxes having cameras so that one can immortalize their gal's reaction?

Jobs and Announcements

As Guild Mortgage Company continues the march to establish themselves as the leading privately-held mortgage company in the nation, expansion continues in its Texas Region which includes Texas, Oklahoma, Arkansas, and Louisiana.  Founded in 1960, Guild Mortgage is licensed in 37 states and servicing currently exceeds over $17B.  Guild also has interest in purchasing or acquiring existing mortgage origination operations. If you are a branch manager or loan officer, looking to align with a direct seller/servicer in one of these states, please contact Jed Rudd, District Manager, at 682-498-8990.

ResMac continues to expand its Wholesale and Correspondent sales footprint by hiring veteran Tim Verinder as Regional Vice President of Sales.  Tim brings over 20 years of mortgage sales and leadership experience to ResMac and will be covering the state of Texas responsible for the development of the Texas Wholesale and Non-Delegated Correspondent sales team. "ResMac was an easy choice for me. In addition to their competitive pricing and can do attitude, I was very impressed with their current technology platform and the enhancements yet to come.  For me and my customer base, it's all about strengthening the partnership and the ease of doing business," says Verinder. Founded in 2008, ResMac is a privately held mortgage origination and servicing company headquartered in Boca Raton, FL. For additional Wholesale and Correspondent sales opportunities with ResMac, please email your resume in confidence to: Go ResMac

First California Mortgage Company, a premiere mortgage lender, is looking for processors, government underwriters and closers in Arizona, Texas, Colorado and California. If you are interested please confidentially contact Shannon Thomson.

Secure Settlements is seeking qualified and experienced sales representatives in the West, Southwest, Southeast and Midwest, and also a national sales manager.  Excellent opportunity to share the fast growth of a company viewed as the first and most respected closing table risk management firm.  The SSI team is comprised of men and women with mortgage, legal, title, IT and accounting backgrounds. We offer a fun and rewarding work environment, excellent benefits and an amazing opportunity to help shape risk management programs and tools in the burgeoning consumer protection and bank regulatory compliance environment.   Preferred candidates will have at least 5 years of experience in the sale of mortgage industry products and services.  Email us at info@securesettlements. com and fax resumes to 973 463 4299.  SSI is an Equal Opportunity Employer.