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Non-Tech : Bill Wexler's Trading Cabana -- Ignore unavailable to you. Want to Upgrade?

To: RockyBalboa who wrote (1614)	2/8/2007 8:00:18 AM
From: RockyBalboa	Read Replies (2) \| Respond to of 6370

SUBPRIME D-DAY: NEW: Subprime problems!! Under reserved! yahoo.reuters.com By Jonathan Stempel NEW YORK, Feb 7 (Reuters) - Two of the biggest lenders to Americans with poor credit histories said on Wednesday rising subprime mortgage defaults will weigh unexpectedly on results. HSBC Holdings Plc (HSBA.L: Quote, Profile , Research)(HBC.N: Quote, Profile , Research)(0005.HK: Quote, Profile , Research), Europe's biggest bank, said it plans to set aside $10.6 billion companywide for bad debts, 20 percent more than the $8.8 billion it said analysts expected on average, because of struggles in its HSBC Finance Corp. lending business. Chief Executive Michael Geoghegan is directly involved in trying to fix the problems, it said. Reuters Pictures Editors Choice: Best pictures from the last 24 hours. View Slideshow Meanwhile, New Century Financial Corp. (NEW.N: Quote, Profile , Research) projected a fourth-quarter loss, and said it expects to restate each of the previous three quarters' earnings lower because it did not set aside enough money to buy back subprime loans that went bad. Analysts polled by Reuters Estimates had on average forecast a fourth-quarter profit of $1.06 per share. Both companies announced their forecasts after U.S. markets closed. New Century shares fell almost 16 percent in after-hours electronic trading, while HSBC's shares fell 1.9 percent in early trading in Hong Kong on Thursday morning. The lenders are the latest in the subprime sector to warn of poorer results as home prices rise more slowly or decline. This makes it tougher for many borrowers to refinance adjustable-rate loans as rates reset higher, resulting in an increase in defaults. New Century and HSBC Finance are respectively the second- and third-largest subprime mortgage lenders in the United States. Irvine, California-based New Century made $13.8 billion of subprime loans from July to September, while Prospect Heights, Illinois-based HSBC Finance made $11.7 billion, according to National Mortgage News

To: RockyBalboa who wrote (1614)	3/13/2007 8:41:17 AM
From: RockyBalboa	Read Replies (1) \| Respond to of 6370

Subprime - This is already worse than 1998... and yet we don't see any ramification in other markets, except some volatility and of course in housing. Alt-A loans. Otherwise conforming loans with much less stringent documentation. A recipe for disaster. Subprime in disguise NDE, Impac and likely CFC are doomed. I am amazed by the sheer volume of loans with - regardless how you name it - insufficient documentation.

To: RockyBalboa who wrote (1614)	3/27/2007 6:08:54 PM
From: RockyBalboa	Read Replies (2) \| Respond to of 6370

Morgan Looks to Unload New Century Loans By Laurie Kulikowski TheStreet.com Staff Reporter 3/26/2007 5:16 PM EDT URL: thestreet.com Updated from 2:34 p.m. EDT Morgan Stanley (MS) is auctioning off $2.5 billion worth of New Century Financial (NEWC) mortgage loans, which could mean that a bankruptcy filing by the lender is near. The New York investment bank announced the sale of 13,200 loans through print ads for the public auction on Friday. The news was first reported by The New York Post Monday. The loans were held as collateral by Morgan Stanley for providing financing to New Century as the Irvine, Calif.-based subprime lender struggles to stay in business. The auction is part of a "protocol" to get a sense of what the loans are worth to potential buyers, a source familiar with the situation said. Morgan Stanley placed the ads in the The Wall Street Journal and The New York Times. Lenders such as New Century, Fremont General (FMT) , Accredited Home Lenders (LEND) and NovaStar (NFI) have been rocked by rising delinquencies and defaults. In addition, the companies also have been slammed by financing providers looking for lenders to take back at least a portion of loans sold to them. Morgan Stanley's move comes as rumors swirl that New Century may soon be filing for bankruptcy. New Century has stopped making new loans and funding loans in process as virtually all of its lenders have yanked financing to the company. Matt Howlett, an analyst at Fox-Pitt Kelton, says Morgan Stanley's decision to cut its losses is a "last step before bankruptcy" for New Century. Howlett says lenders like Morgan Stanley are "losing money every day" with these loans. The lenders, he believes, are figuring that New Century isn't going to get the capital and "it's probably better now just to cut your losses than sort of working them out in a lengthy bankruptcy." Several other troubled lenders have recently been bailed out. Fremont General announced last week that it is selling $4 billion of loans. The Santa Monica, Calif., lender said it was exiting the subprime business in February. Accredited scored a $200 million term loan commitment from hedge fund Farallon Capital Management of San Francisco. Accredited is selling $2.7 billion worth of loans held for sale to an unnamed buyer so it can meet margin calls. Howlett said both Fremont and Accredited have "better quality" operations than New Century and don't share the same liquidity issues. New Century also has been hit with multiple "cease and desist orders" from state regulators. It is under investigation led by the Securities and Exchange Commission and U.S. Attorney's office, and the New York Stock Exchange delisted the company for falling below listing requirements. Most recently, Barclays has asked New Century to repurchase $900 million of mortgage loans. A call to New Century wasn't immediately returned.