Ocwen improves Q1 net income by $35m year over year

Ocwen Financial has announced that it improved its first-quarter net income by $35.2 million compared to the same quarter in 2017.

The company reported net income of $2.6 million for the quarter, compared to a net loss of $32.6 million in the year-ago quarter. On a pretax basis, the company’s first-quarter income was $5.0 million.

The pretax results reflected, among others, $20.5 million in favorable Ginnie Mae and GSE MSR fair value adjustments as a result of the rising interest rates in the quarter. This was offset by $21.0 million of costs related to ongoing strategic transactions and restructuring costs, regulatory-related legal fees, and other litigation and regulatory settlement expenses. Pretax income for the quarter, when adjusted for these significant items, was $5.5 million.

“The first quarter of 2018 was an important one for Ocwen, and we accomplished a great deal. In addition to starting out the year with a $2.6 million profit, we received $280 million in cash from New Residential (NRZ), we announced an agreement to acquire PHH Corporation (PHH), and we helped almost 11,600 struggling families remain in their homes through loan modifications that included $59 million of debt forgiveness,” Ocwen President and CEO Ron Faris said.

Ocwen reported that its servicing segment recorded $20.5 million of pretax income for the first quarter, the seventh consecutive profitable quarter for the business. Its lending segment recorded $8.8 million of pretax income during the quarter, a $7.7 million increase over the first quarter of 2017. The reverse mortgage lending business recorded $9.8 million of pretax income, while the forward lending recapture business incurred a $1.1 million pretax loss.