The costof regulatory oversight of Ocwen FinancialCorp. stemming from its settlement with state regulators is approachinga level that could be unprecedented, CFO Michael Bourque Jr. said April 27.
The companyreported $30 million in monitoring expenses as part of its first-quarter earningsreport. With about a yearleft on its monitoringagreements, three morequarters of the regulatory expense at that level would amount to an annual costtotaling about one-third of Ocwen's market capitalization, Bourque said during acall to discuss earnings.
"Basedon what we've been able to discover, we believe the level of monitoring being forcedupon Ocwen is very high and perhaps unprecedented," Bourque said.
Dataon such costs is not readily available, the CFO said. The company cannot speak publiclyabout the costs in detail, but officials have been discussing the costs with regulators,he said.
The regulatoryagreement with New York is scheduled to end in March 2017, and its agreement withCalifornia is set to expire in July of that year.
In themeantime, Ocwen has continued to build out its lending capability in accordancewith its new operating strategy,President and CEO Ronald Faris said. Mortgage origination volume increased and returnedto profitability. In addition, the company's auto capital services commercial lendingbusiness is now active in 12 markets in eight states, Faris said.
"Weremain encouraged with our progress here," the CEO said.
In loanservicing, Ocwen continued to bring down the number of complaints lodged with theConsumer Financial Protection Bureau, and has become an industry leader in loanmodifications, Faris added.