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New Residential Investment (NRZ)

Participants
Mandy Cheuk Investor Relations
Michael Nierenberg Chief Executive Officer
Bose George KBW
Ken Bruce Bank of America Merrill Lynch
Kevin Barker Piper Jaffray
Tim Hayes B. Riley FBR
Trevor Cranston JMP Securities
Call transcript
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Operator

Good morning. My name is Beth and I will be your conference operator today. At this time I would like to welcome everyone to the New Residential First Quarter 2018 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. you. Thank Instructions] [Operator Relations, begin Investor conference. you Cheuk, your may Mandy

Mandy Cheuk

call. I good to Residential’s Thank earnings and everyone. first would XXXX New you, Bess to morning, like today welcome quarter you

our Joining New this CEO; Jonathan me Residential our the earnings website to Throughout morning. we’re CAO. are posted supplement here Michael that Brown, Nick our was CFO; today Santoro, and going reference call, Nierenberg, to the

now. I so, If you suggest you download already have would it that done not

to Michael, annual disclaimers filed I be I I like the our regarding statements and SEC. press turn review actual over to statements you and and with will Before out point factors the today release by uncertain and certain from supplement the forward-looking in would contained quarterly that review results. risk differ encourage reports our the are call to in earnings statements These to materially may their forward-looking made nature statements.

during non-GAAP our earnings directly In comparable over turn in call can found addition, now, most we’ll be reconciliation measures GAAP the some be to the measures financial supplement. these today’s to A Michael. discussing would measures to like I of And call.

Michael Nierenberg

a ready our really things looking the deal that everyone, call earnings call, earnings quite comments in in of Mandy. the that not did there's and we frankly QX the for and to Thanks, was has February earnings getting Good our lot and was occurred today, changed where thanks for back call. morning, joining this I I from world. call and have to the some are that February and political of despite we

like good had a quarter. quite very business the well, should. The For we it performed really quarter frankly

abundant. environment investment fairly QX portfolio and rate we Our for muted the was feel the investment shareholders, opportunities, great shape. overall on our excellent terrific during just like were where quite levels frankly value Activity current in based our are that interest our I of we’re are thesis continues view create and not to as performance

prior capital asset on the are do create offer for I value of shareholders. call, where great most and fully an not priced of earnings As a abundance classes mentioned ton to our continues environment

portfolio billion a portfolio unique can’t and can right make Quite MSR this billion us frankly, $XXX company. very, $XXX call replicate very company. Our you

to As we we we in we something have move need forward markets, to we of the so. should access and plenty do liquidity that capital be continue to have investing will

terms we we move to glossary some to little this simplify of so it I a as tried I through hope walk put little our As in makes the that bit bit we supplement, there, supplement, and business a the REIT now now mortgage more are has NRZ X. obviously to been to a self-explanatory. have begin $X.X and a market Page online we going refer cap of supplement, posted we I’ll which the Currently I’m billion. on and

we that want was the our billion portfolio to a then two total of the MSR on XX% side ’XX look of to billion. portfolio bit there’s and right I classes from we right return the page, you asset return the As activity, one our but have, and highlight highlight little reel still numbers XX% our $XXX ’XX, had a again is large of $XXX call

$XX.XX. of to we want end other point $XX.XX the book at at The QX thing I our value, now which reported out, is

quarter, three GAAP million our So $XXX income very good number diluted $X.XX per performance. for On the net again, page or share.

per million $XXX or and our core million $X.XX dividend or $XXX diluted Our per share. $X.XX diluted share earnings

the are page of it to a should environment. one kind and is to out performance to interest industry. point things U.S. So as we again, very the couple good here, this of provider of I pointed mortgage perform four, like On we out continues and earlier, portfolio leading in capital think

business, you amount we and we have business, two, this rights that one If to we the due we play servicing our servicing classes that rights home-owners a the to in counterparties that with try about business, simplify believe think important mortgage in U.S. we I associated role the mortgage securities and of touched servicing make non-agency housing opportunistic market. advances purchased the asset have we investments. The again call where very

on speak different the As to use about this we our you define could try business. when that we see page, terms we

we’re X% deal bulk licensed became the earnings servicing some and Jefferies, opportunistic XXXX have an our bit take and from well appraisal independently the and for optionality and to the could current and a of an perform thing bit. little a be in Shellpoint agreed that On as and HLSS in possible stable try Third Mortgage. originator part Shellpoint On growth page to for the we page reel. that full-scale Point is is an four-member again see again to of important Shellpoint. right six, think highlight made XXXX XXXX the five, bottom Citi business I’ll fully partners, acquisition consortium and of including of counterparties in mortgage announced Partners, we’re ancillary servicer in in MSRs to opportunistic our more of and different got mortgage X% core page book acquisitions a of business I large type environment, we business. extremely The little of well full-scale XXXX consumer capital to the of origination continue different joined it's acquired that point talk then loans we with want a was you we a Company, and to side nature I Shellpoint today. title standpoint, value, as a servicing about in lot to then a transformational equity November buy well On a we page company, we business most going out, from and as in and Soros continues rate setup and interest different to acquire then the our from a XXXX get about number company with as the to an

On the services billion servicing. today third-party billion over mortgages in plus $XX of servicing are Shellpoint mortgage a which side, XX little

As it third-party it's for for the which for important forward to business for its will not continue Shellpoint look very focus maintain as as of well third-party its been and we Shellpoint. very think on the business, fruitful nation both become focus we will its size example on is to third-party a store, Shellpoint independence

on we market expect we page licensed and as how two this do the origination year billion its this go business on the side, Fed Freddie think Fitch see least Ginnie times fully that bunch and many the fully On NRZ us. into to last something Shellpoint that and to speak. a to for turn as Moody’s be three does between year. profitable approved then $X expect at Page Shellpoint by the by going maybe did closes S&P, business $X Fed We and billion times really of billion, this acquisition rated and just and well. between we Fannie is once the and year and by another mean $XX X is What

that one flip that income value how to to after about the were you class, shareholder assets means actually and rise. a as can use MSRs of in what think few page our If rate talk fixed X, increasing is we each I business.

look large quarter, that in you little talk when numbers bit. gap we we So, the to at had a can some

off in shortly. each Some of shareholders. But MSRs general, advances should well MSRs, in to that due the interest bucket having conversions to portfolio full Servicer our higher excess will some look MSRs. that’s to from we to environment rate due as MSRs, of you of extremely to and for billion do some talk $XXX a

done look that advance have portfolio, the markets in a XXX team business equity, of at with the The bank today to NRZ you is servicer fantastic As financing job our capital partners. amount million. the asset that along a in we has

of And a it’s home floating servicer our to our important amount today. about as likely of and lower you the securities On outstanding it advances a rate. to So, delinquencies think and of continue XX% continue rights owners less business clean-up decrease. non-agency when call trend will really business part are

we’re components loan interest And that to our the Fed to income. hedge fixed on interest other of and out rates So raised, that to business the net consumer rate going On rate risk. hedges assets, used underlying loan the as achieve had higher portions interest rate business. is we a

or On coupons. X% coupon, duration the X.X% are loan a loans side, for most of assets, example very higher our short

environment even one the rate Fed and three interest around funds current where you So in quarters. have

rate interest for rates. XXX, have to position on fixed have the think, LIBOR net have amount portfolio protect high lower Overall, situations and the that to we interest extremely in against our you on continues higher environment. interest assets income balance our rate great of a we we’re us then current coupon, where have we rate be where sheet So, hedges

call our I Now, if consumer where and is I’ll up the bit, of On I’ll then just of open balance cash excess securities bit $XXX a investment little the amount the up page been up equity investment million. through at Servicer a see and that’s rights When a amount both is page $X paid net is $XXX pretty net of for different info, million. $X.X quarters. advances you we’ve portfolio, $X portfolio, loan debt a of asset million, billion XX On some net questions. $XXX our recent you our of in loan our sheet with and you’ll we bit currently billion, you’ll there to business. is pointed you our down are which bit there, up amount our our been growth our have classes, residential look just then over equity which on little And excess net click billion. approximately investment is little in out, equity residential then while prior take consistent a wrap we have has our we little XX, MSRs, see on it that’s because a our with

QX million. at Finally, the end our cash of amount $XXX was

funds billion about XX of of muted, the page to principle In in were our activity a our out and on thought that to up did non-agency to end a think our million subsequent the were, to of acquire as $XXX then MSRs to of would quarter we've I during on $XX legacy pointed MSRs of acquire services and in to We $XXX had. in rights rate markets earlier another cost $XX wasn’t recent I we we fee fairly January fixed February, remaining value million agreed talking we lot Ocwen also restructuring the two of there totals the obtain of In also the to priced the Ocwen, a investment add notes at then some levels a we we and shareholders. X.X%. general, totaling MSR do paid billion QX. then and that weighted lot Now QX portfolio at [$XX million] activities January average

We our you XXXX back I and to forward. for that our we we've of things deals think that recall be portfolio, and you about equity mature transfer RMBS, very backed a MSR we to non-agency rate portfolio think servicing clean-up purchased under very bringing that the January advanced executed business as quarter. the million take think if base receptive as MSRs XX XX during able is floating $XXX little been on converting was We going very, to net our financing, the $X.X we on seasons, season, again $XXX investor and a so to important and to in securitization debt much note, non-agency by the in completed continued our to to or is that’s we're give seeing issue one more going non-agent XXXX, $XXX fixed during our quarter, did good about MSR the markets that our focused financing the million and million cost billion. a rate size of this very

is, $X was of, it seasoning billion $X as indicative the out earnings way continue one, pointed Advance in little homeowner to Servicer about over loans really work as their to pipeline. heal their the prior the three that’s just continues the billion, at portfolio, peak I business, calls, a totaled of think and two, delinquent through Our is I

Fannie the fund the from to on portfolio acquisitions felt market. then were be as operator grow IRRs executing some than we $XXX in we current we about what in to we it’s the sheet help to activities. it to to and and there that little review, it equity time did for subsequent raised On fairly the pool QX over well finally portfolio the based of lifetime our buy go the part and cash most of on extremely portfolios time loan is continues And as The legacy relates choppy questions. side, have on just entire Operator? deal I’m a well, then million to open IRR We amount that prosper, million. $XXX about our that our is loan a XX%. to of more a call Rather to have going turn back of SpringCastle business January as and loans Mae it low, the to balance invested end different really our of deal XX% our equity will and portfolios again over bit perform was be and expect perform consumer well continue up for through contract going in

Operator

[Operator question at George the line Instructions] comes KBW. from first Bose of Our

Your line open. is

Bose George

Hey, good morning.

question just the ancillary fees you book the from is on of more you is portfolio, just about talk idiosyncratic in about Ocwen the drivers a terms just First, assumptions or can rates acquired? guys there marks value, any of increase, things it the or

Michael Nierenberg

Sure.

rate things. existing about driven million. of call in our from Ocwen the portfolio would with by rising large on were MSR Ocwen it's couple would from acquisition Clearly away the I what a a mark a adjustments be portfolio So, $XXX environment,

about business million to and $XXX referral [REO] deferral million. As that accounted was transaction the you one our about the in is, we not the look get excess conversion $XXX and then from on are for fees, was were Ocwen

really So, of related our was call it -- the it. growth our MSR bulk the was our and in GAAP earnings to that business

Bose George

kind how the increase? And had actually thanks the rates the when you quarter, have the then about think impact we’ve should of of about the that end since we great, maybe Thanks. $XXX of it Okay move in just helpful. think million in terms

Michael Nierenberg

You forward? going mean

Bose George

basis into points Yes, just XX moving the QX. ahead or so,

Michael Nierenberg

but what book MSR is relates forward, you one portfolios. will increases value rates, would earnings further say in thing it see about reach the to there more GAAP in negative as think your convexity a Here's I assets, go thing keep valuation only going is I go as as and to -- our assets you go our income up on so to get to some one mind much. really of where MSR you’re other we believe regarding point assets Currently room the and the to at there will a in forward, we fixed point and

While amount to saying when the where are the things trading in go are that, like we the multiples room there at a now of feel right on to where portfolios, is fair marketplace, look upside. you MSR

Bose George

could kind guys more great, on we sort see May then incremental? deployment Okay actually or where And meaningful that’s one of just you Ginnie helpful. once is of -- have license that just kind an the capital area of

Michael Nierenberg

think either of and we’re then out acquire position to contract about competitive The value platforms there’ll is very are and picture environment at of further there overall look relationships, in the nature banking feel we capital Shellpoint you origination of mortgage in and and for the banking bolt-on be be to function based us and servicing the great need as margins when continue other MSRs, look a great bigger as And I to their think deployment. in MSRs I the portfolios think we feel I you at quite see the long I origination like some the can these in right I to real which and see or you mortgage future. in going business, think our community excited community other to higher business. now, compressed overall of on as a ability meaningful quite Shellpoint portfolios, you with shape as that what when rate think MSR to on do, frankly we’re deployed acquisition as to the on that originators you’re I around who asset capital the going are side the coupled fairly more well needs on frankly do class

really don’t banking asset around be think I they assuming going I but to the is again through think capital these classes roof, excited deploy ability more go hard, the we’re very mortgage that to that. crazy about

Operator

Your next the line America from comes Merrill from of Bruce, Lynch. question Ken Bank of

open. line Your is

Ken Bruce

first nature but have I a questions circle a bit Hey me. of bit different and a little in could and technical thank got is good -- square for a hoping assume the you I morning. maybe you one little couple

several, you certain and back got a in at of if too I in have last of say the out look back significant look a capital. if should is go So, or far capital there you paid the ordinary to history, dividends, return want really dividend to you amount over didn’t paid several amount capital, of

And of for been mortgage a residential. kind capital of somebody of drinking in case their effectively we’ve a in blood long is been out always if of so the the non-sustainable in REITS have situation schooled sense paying us time, own those who around new that’s thought and is

core well. well earnings Your through earnings dividends, dividends have as been have been your GAAP through your your well

such it? creates me you a percentage kind help what return of just high dividend for can understand capital your that of maybe to of So, backdrop have in

Michael Nierenberg

by piece generates driven piece. capital income our capital any really that taxable ordinary income the It’s

with had So respect has low today, taxable our our been to we for dividend. have tax income relatively purposes,

Ken Bruce

not am that? clear or to creates issues timing what, this is what And I guess quite I still

Michael Nierenberg

It’s timing.

Ken Bruce

should Okay. window? longer some over point, guess I reverse a At that

Michael Nierenberg

That’s correct.

Ken Bruce

of, the what space. many announcement have an in of day, it space. kind the us acquisition recently in I consolidation guess about of And the was REIT underscores And thought agency there just is of other there mortgage

of not companies and for kind MBS anything different of be that been you terms the in participating nature one consolidation the you acquiring capital like. transaction agency effectively a in but to frankly I can might when in interested sector? of And there that, currencies with what better active guys experience investing, terms in portfolios types the and of You in you’re that have like interest look discuss the got acquiring work you cheap. necessarily and know have do Is across your of of to kind you’ve at as

Michael Nierenberg

we’re deals When you wants When cost the generic and if X% assets the foremost first X% say But environment raise this going to really of been thing one And and something way that don’t discount we raise between raise and that to sake you’re do markets, capital. on quite I’m to look one capital, we capital we at took is saw of we’re first. be typically, would risk is and most going raise points investing deal to to in going very frankly capital consolidation the might is we the of is I is, acquisition we more that the an the breakage are and needed deals, good. if go to the our need really see it we in And for like although, not clear raising and equity we want just everything capital we capital. Or taking market of equity. to we the our premium also we’ve want based. and and capital this of set raising sheet. capital. have Obviously, market raise don’t which all dilutive for And on premium where, okay. of after create are that you particularly and look paying The about cost capital is could everybody shareholders. If REIT done getting then around say equity, the done, we’re more balance goodwill plus you’re to we of sake Sure. taking this X these for the very, just effectively particularly for some risk, and way try then the pay marketplace what say, at issue and and look we at put this something like to shareholder always issuing

works at everything. and and do and we’re and these we say to deals. this will we that do overall, meaningful to for going want it’s the So look it. of not this frankly quite Unless, at certain shareholders not never for capital, we folks looking some think we our and need to

Ken Bruce

to to know I guess where understanding you area the landscape don’t from lastly, Shellpoint with in I structural always the understood that some in that an that going I just I’m And another guess, and standpoint, market if change as both Shellpoint I intrigued point talking servicing gain strategy be properly? share your I there’s maybe and and should there terms be able that am operator of origination see

Michael Nierenberg

grow way about to to think Shellpoint the it business Yes, and and quite that of so he is person for. keep does number stay That job. clients he that here is And runs Navarro, third-party from they to different that NRZ. we Shellpoint, looking has and looking a needs fantastic frankly service Jack that a are a independent to way and that

not some there. it's acquiring there the of be not to Cooper, sub-servicing. Mr. our a QX servicing, a is a is on likelihood different NRZ end use a for it's we’re a special the business so acquire so of likelihood grow our very partners a work servicing we different IE will continue portfolios there of existing we Shellpoint servicer third-party mortgage -- announced store, around likely number Nation captive with we servicer, and of servicer, is good to We to would in that. terrific agreement example, that to would who large that strong would if that subsequent portfolio go that it at So, going acquire we’re also

a many have in volumes is and very Gain origination very, we’d MSR very, and the and the going now those while origination origination low continue around very seeder origination for be right that that a to hard. in origination our is business see very, business, come think hard is sale business down up, and it industry balance tight rates we backing to hard On very to growth for the the is very and about years, could you mortgage like those actually on hedging grow of feel portfolios as side, we in sheet been think for the very mortgage a you’re portfolios.

servicing as offer types from Than a think like different nation obviously. Shellpoint as on and seeing NRZ third-party And of I ancillary special feeder of independent a to will our actually growth want products relationships and our and Ditechs continue for won’t that I continue any our to size and So, look with example, that the side to very of the if PHH of we MSRs we that to the as focused store, use could we’re Company. business. meaningful customers we mortgage mortgage, so-called Ocwens of there’s for away the that that our think for have be be on or the landscape, opportunities origination grow at

Operator

is please phone mute, unmute. your If on

Barker, Your Piper next Kevin question comes from line Jaffray. the of

is line Your open.

Kevin Barker

in rates to stand the of you rights where given value call movement call what that higher regard In on and rights XX-year move interest can give how looks us just opportunity looks now, view when market the these rates the rates, secondary moving your like? the in

Michael Nierenberg

all fixed overall the as on the know interest so rates first income we will prices lowering one. debt. Sure, all dollar to higher issuance That's lead in of of

that make something two points, keep call three that's whatever we this whether we an a different on eye about do think transactions points, So, on. we point, when you so

side when to of fund less housing a then is I that non-performing $X.XX buy deals, for is that, current something it we result we’ll we’ll or think seeing pay markets, we’re delinquent that. and have down like example loan fewer economy on whatever buy -- these and when do to call the based for the loans, come the to and as as in have we’ll number that flip delinquencies have and down lesser to we a market what

profitability still very overall the good. be should So,

slow be and in of all whether on benchmark collateral index. a the fair done, loans, on markets tighten amount our by be front, sit go think that in to a been our interest really activity this up rates market, is to on has capital amount, be we that a continue means you’ve I to activities receptive that fair a we’ll seen is be on the of rate only flip whether issuance protect of and that we down, On that pool marketplace of whether is number reperforming peers interest the going continue rate their relative us there a when of higher lot in this if should hedges not you’re but that us spreads is to environment. prime non-QM, put very side that identify What overall as yeah that market robust, on, to typically assets the collateral a see

well. So, overall, I to would expect that continue do business to

solution market the out bigger legacy business got delinquent mortgage to when be you these the pipelines has clean call to non-agency the loans. picture of think the I for

billion so there an on billion, as in a frankly or at we deals X% give our industry these quite all and would call in If or that REO, take fit work those loans. you deals, should be I look should or together those numbers loans trust sit mortgage we no $X is those able think REO, using is that X% to X% reason the just liquidate of round rights, $XXX on these legacy in if

clean this something we’re continue to it's to had different that So around to and that folks ahead try push I’ve up something to with business. focused try that we’ll conversations some on,

Kevin Barker

you correctly was detail REO, fees then if could associated just that heard in there you comments whether And a with REO, your I a you prior Okay. mentioned little bit? the markup in

Michael Nierenberg

fees of REO result the would we QX the part of the did markup, We services for in keep provides REO transaction. will we that the assets earnings referral business that GAAP that full get that underlying not when us. as and accounting reflects that that mind so Ocwen, we no a business the transaction for Ocwen Altisource was Ocwen services get from and There MSR on referral for were with fees

Kevin Barker

I me those that X.X if that negotiation? fees am Correct or changed about within on has wrong, was

Michael Nierenberg

you about the I that million for amount $XXX the would total was quarter. a tell

Kevin Barker

the basis or value markup Did that]? of total [hasn’t expect value you amount is over in the that

Michael Nierenberg

it a Well we’ll wasn’t fees of get been for accounted for, mind, so keep a referral portfolio. now result that in it's accounting those just result as of that

Kevin Barker

detail Walter to to but million, acquisition to Okay. $XX relatively valuation going of to that a mix obviously portfolio And just past little purchasing its just XXX and it points was behind the regards you compared after seemed today? Can made, the in tend it you some portfolio be acquisitions. basis reason to the portfolios about a high value bit you MSRs and find attractive the the be that then that of and portfolio why closer

Michael Nierenberg

and have slower sheet. XX-year the in is. where when MSR balance present back time, X% of Overall, business, go we you we the any on notes, didn’t market speeds if kind our leverage

the and of double-digits. return financing with efficiency markets return financing give acquisitions lower MSRs. we’ll around probably the about these and We Now feel investment us, of on

the it. reason that’s So we really, did why

Operator

of Riley question the from comes line Tim FBR. Hayes, B. next Your

Your open. line is

Tim Hayes

asked have and So, already asked answered. I apologize if been any questions

to risk acquire just do receiving So, adjusted with will Ginnie license, appetites upon versus you’re you return like be assets the financing today? given the seeing closing of what and there think agencies to the Shellpoint and your

Michael Nierenberg

it earlier an investment reasons interesting that that good, my be lot were deploy valuations. capital of will things we in just pointed it think a being perspective. on for from I the I depends not didn’t out comments,

to and our going rates. X believe, the XX We As into to thesis to MSR then is raise Fed go another relates the continues portfolio, raise rates this same. year X times be likely it the to years investment

be class the our asset on investing be asset will result, higher and will continue good higher, behalf be itself, mortgages a As treasuries for on think rates of we us to a will very class yields shareholders.

that, mindful the to because And saying interest straight, it we overall While things rate. level need be the of are a fair multiples values amount. of should be, up where absolute are of

more us, deploying we attractive, capital investment for there. So, find if we’ll the

our we’re of Ginnie's doing likely it earlier, ton that the we out Shellpoint not pointed closing been Shellpoint versus if the parties. We to sub-servicing counter licensed haven’t deployed licensed, really portfolio any grow that side acquire going does But it’s some capital upon mean and on sub-servicing settlement is our the haven’t an necessarily attractive and MSR the Shellpoint a we’re as other I deal, investment. investment, of

Tim Hayes

rights the from earnings give, did the core then you happen call quarter? this to And impact just

Unidentified Company Representative

$X.XX quarter. It’s per

Tim Hayes

around then or in $X.XX, just that quarter a you fundamentals this of of any better color you seeing And okay. change worse kind driving economics? from little bit give can the securitization and profitability are are

Michael Nierenberg

point averaging it’s think and something I a half. been around

interest mentioned other on we protect rate collateral against rates. The thing a to hedges put will we typically when us pool identify some higher I is, of

where You’ve seen assets compression on tighter the and meaning spread actually are issuance tighter trading on spreads.

that’s our that’s are so And you prices higher, rates our helped hurt the then arbitrage, interest counter overall ‘re up, that’s So arbitrage. seeing that loan helped arbitrage. to our is

share. always you’re seeing $X.XX only of, a different overall, deal be So each the something honest. mean is quarter and vicinity I And to in per guess was about I there for the half. point

Tim Hayes

were one were last you this acquired the to of one discount then at the out you able And class for deals? of non-agency pulled how quarter me. and of acquire much What non-agencies Okay. kind

Michael Nierenberg

average a The with And non-agencies are bit of are they bought the were I Again, little associated believe we $X.XX. really rights. call around $X.XX something market. or where in on price the was south yields

Operator

Bose Your next KBW. the from comes George, question line of

open. is line Your

Bose George

I million follow-up was XXX you the REO The from a the million XXX what the just MSR. on fees. that Jim, mentioned? was referral quick had

Michael Nierenberg

recall that was the initial converted Ocwen made full And had HLSS excess. the payment excess to and we of we when with Ocwen, you That January, MSR. the to transaction conversion only as excess in we Because owned we the on. then

million. So $XXX approximately was that difference

Bose George

you driver the whatever figure because that purchase to marks the to strip. trying out contributed the fee of Just

kind of So, kind how essentially it mark? is discount that like about on got the of, we think should that or you that

Michael Nierenberg

going of with who couple a Miller, X close, Andrew this It’s is things me to to points here let year. I’m sitting

Unidentified Company Representative

MSR. component you drivers There are slight for two those So, excess advances, treatment to of difference full also is biggest move the associated just of from in the the biggest liquidity it XXX. is improved accounting the MSR as an

Bose George

And mark or you there sense. just is guys Is receivables. financing to related the answer that’s an that? something question. you just that makes else on actually gave That accounting the that driving then MSR show The

Unidentified Company Representative

gave. just is to related answer the That we

Operator

comes JMP question from Trevor Cranston, the Your next line of Securities.

Your line is open.

Trevor Cranston

Just question on Shellpoint. one

way in of type Thanks. also NRZ’s you the it in future? on sheet the non-agency foresee, I currently be sheet whether balance origination on and guys originations much comment side. that balance not that You feed you could for has interest if wondering, as of capabilities like Shellpoint jumbo prime a MSR mentioned was could hopefully if using non-QM something or NRZ's the or

Michael Nierenberg

they’re originating some Shellpoint prime originating also is jumbos. currently some products, non-QM

are right So increase, large the that volumes business not now. should

with is I tops from in add of market the we chance a QX also, number the on a be strong frankly, We’ve the different company. think origination deal based volumes non-QM with quite we’ve in a and from other there could around are actually Shellpoint, as to But going seeing and think be you’re originators originators as you more provider activity them overtime, well. I to see think we capital some jumbo I non-QM a will well.

Operator

of from Your line Jaffray. question Piper Barker, comes the Kevin

line open. Your is

Kevin Barker

the to X the made this or us is regards billion closes? that’s give just comments X year. in Michael you deal you the after entire Could Shellpoint about year when idea, an that to

Michael Nierenberg

$X to year an in year did basis. it, on to think origination, say MSR the the business. I a billion I Shellpoint between way year third-party No, billion do it it's a to Shellpoint expect about so again, am last $X.X billion it's right, something hard about would -- of truly we full the entire is going and tell -- production this And $XX but year,

as that think so going I somebody his $XX and on is model if to between operated on but has So, be like going clients. just production. actually to trade got And much you’ll a better bid MSR billion third-party away, $X focus the they business of running the billion it's see servicing could Jack use will a X answer originate third-party and short origination its we’re roughly the side, volumes best business,

Kevin Barker

on [of expectations and mix how for that an your give agency, refi retail X]? much between difference purchase versus us you update Could non-agency, in how much is

Michael Nierenberg

going you, up, back I to got are Kevin, back refi I forward get with guess, to a home I going to to you going think prices am in but to less, see you’re I markets have to mix.

Kevin Barker

Okay.

Michael Nierenberg

mortgage it what would better to numbers with get are from back be and get other bankers but you consistent I’ll think I some let shortly. you me seeing

Kevin Barker

Okay, and then you are reiterating will by the end deal of second close? quarter

Michael Nierenberg

close show don’t it second hopefully I quarter. the date, the to again end but want of the by this absolutely Yeah, we’re

Kevin Barker

associated those PHH you disruptions any and the given new us? are their any then do how and transition loans on Ocwen follow-up counterparty between PHH serviced expect servicing or changes one Okay platform integration big and they more a with as deal, pretty from the

Michael Nierenberg

we No, don’t.

servicing it been whether Ron think the has would be over Glen think now fairly operations the have expect so be for we both time, long a taken I in I seamless. organizations or it role to

Operator

no questions, call to are will further now There the back remarks. I Nierenberg, for Michael closing turn

Michael Nierenberg

be – think quarter, Love you for thanks excited joining hopefully runway, are lot as and consistent the we’re going good our very future, So, call comments to is look hopefully I think what forward. our about a of questions this growth strategic we gave acquisitions. I the great some we that and likely is near business we’re in that and support. just With and weekend environment not your Friday, our be all the were up bye. our for way investing interesting through set our overall Bye have portfolio, opportunistic in that thanks happy the in

Operator

conference call. today’s concludes This

Thank disconnect. You you. may now