Tag Archives: Morgan Stanley

Morgan Stanley agreed to pay back $275 million to investors whom the Securities and Exchange Commission say were mislead by a pair of mortgage bonds the company marketed during the financial crisis.

In a filing with the Securities and Exchange Commission (SEC) Tuesday, Morgan Stanley revealed it has reached a $1.25 billion agreement in principle with FHFA to resolve pending mortgage-backed securities (MBS)-related litigation. In connection with the settlement, the company announced it is recording a $150 million addition to its fourth-quarter legal reserves.

The checks for Goldman Sachs and Morgan Stanley borrowers covered under the foreclosure review settlement should be mailed out Friday, May 3, the Federal Reserve announced Monday. The next batch of payments will go out to more than 220,000 borrowers who had a mortgage in any stage of the foreclosure process in 2009 and 2010 that was serviced by one of the former subsidiaries, Litton Loan Servicing LP or Saxon Mortgage Services, Inc. The checks for the borrowers are valued at $247 million.

Nine days after an $8.5 billion foreclosure settlement was reached between regulators and 10 servicers, Goldman Sachs and Morgan Stanley struck a similar deal to settle allegations of wrongful foreclosure. Goldman Sachs and Morgan Stanley will pay $557 million in cash payments and other mortgage assistance.

The American Civil Liberties Union announced it has filed a suit against Morgan Stanley on the grounds of loan discrimination. The complaint filed by the ACLU, the National Consumer Law Center, and Lieff Cabraser Heimann & Bernstein alleges Morgan Stanley discriminated against black homeowners and violated civil rights laws by providing incentives to a subprime lender to originate mortgages that were likely to be foreclosed on.

Holders of voting rights in more than $28 billion of Morgan Stanley-issued RMBS and $45 billion of Wells Fargo-issued RMBS issued a Notice of Non-Performance to both institutions Wednesday.

Morgan Stanley Investment Management (MSIM) closed its Morgan Stanley Opportunistic Mortgage Income Fund with over $450 million in capital commitments. The Opportunistic Mortgage Income Fund targets investments in a wide range of mortgage-related securities that may offer the potential for strong cash flow yields under multiple scenarios.

Three mortgage servicers have voluntarily entered into an agreement with the New York State Department of Financial Services in which they pledge to abide by upgraded mortgage servicing standards that ensure fairness for all borrowers. The agreement was forged between Benjamin M. Lawsky, superintendent of the state regulatory agency, and Morgan Stanley and its Texas-based servicer Saxon; American Home Mortgage Servicing, also based in Texas; and Vericrest Financial, based in Oklahoma.

Morgan Stanley has announced the sale of Saxon Mortgage Services to Ocwen Financial Corporation. Ocwen has agreed to acquire Saxon for the base purchase price of $59.3 million. The deal also includes an estimated $1.4 billion for servicing advance receivables outstanding. The transaction is expected to close in the first quarter of 2012. This marks Ocwen's third major acquisition over the past year.

John J. Mack will step down as chairman of Morgan Stanley and leave the board as expected at the end of the year. Mack also will retire from a full-time role at Morgan Stanley and become a senior advisor to the firm at that time. James P. Gorman, president and CEO, was elected by the board to also take on the role of chairman, effective January 1, 2012.