Current news for this company:
Bear Stearns Residential Mortgage - Wholesale & Retail
Update 2008-06-06: In an interesting, if not downright awkward turn of events, the implode of Bear Stearns Residential Mortgage (BSRM) has become indelibly linked to the listing that is Accredited Home Lenders.
Yesterday, Reuters confirmed the Loan Star takeover of BSRM as previously submitted by our tipsters:
Accredited, now wholly owned subsidiary of Loan Star Funds, has merged with BSRM under the Accredited name. It appears most of the Accredited folks were let go in the process. After the initial deluge of incoming tips about Accredited, we received a copy of the corporate memo that left their status in question. Then we got this from an email sent by an Accredited AE:
"Last Friday Lone Star Funds purchased Bear Residential (they offer Conforming and will shortly be adding FHA). Yesterday Lone Star shuttered 4 of the 5 Operation Centers for Accredited (San Diego is the surviving Operation Center). I continue to be your Subprime A/E which the expectation to be offering you a full product line consisting of Conforming, FHA and Subprime loans that are in the pipeline continue to be processed and new loans continue to be registered and approved."
Another tipster wrote:
"JPMorgan is selling off its Bear assets, the AUS went somewhere... their mtg lending unit is now AHL... i bet loan star put the screws to them and said you better start producing... so they went and bought Bear's business."
Several wrote to inquire if EMC (BSRM's servicing arm) was part of the deal. Matt Padilla with the OC Register had this:
"Details of the Bear-Lone Star deal are a bit sketchy but it appears Lone Star picked up what was left of the Irvine-based subprime lender Encore Credit, which Bear acquired last year. Bear Stearns, or better to say JP Morgan, still owns Lewisville, Texas-based EMC Mortgage Corp., a servicer and before the credit crunch also an originator of subprime loans. EMC has an office in Irvine."
Update - 2008-05-29: On the heels of announcements about Bear Stearns shareholders' approval of the buyout, we have news that Bear Stearns Residential Mortgage may not be part of the deal. We believe Loan Star Funds will acquire the mortgage division. From an email we received:
"I guess both JPMC and Bear Res have really kept a tight lid on this one... there have been serious negotiations and offer reviewed for the sale for the past month or so. JPMC has accepted Lone Star's bid. Supposedly, the sale was slated to be finalized yesterday, although the employees of Bear Res have yet to get any confirmation on the finalization of the deal; of course they have yet to received any confirmation of any type of severance or exit package from JPMC either, only a verbal notification that Bear Res would not be part of the JPMC family."
Another tipster confirms:
The source adds there are "still about 400 employees left in the US."
Update - 2008-03-16: CNNMoney.com is reporting that JPMorgan Chase & Co. will "acquire troubled Wall Street firm Bear Stearns..." and notes "The deal values Bear Stearns at $236 million, or just $2 a share - shares had closed at $30 on Friday, down 47% that day."
If this isn't a "firesale" acquisition, we don't know what is. Given that Chase has their own (remaining) existing mortgage lending operations, it remains to be seen what will emerge, and under what name, from this acquisition. Stay tuned.
Original Ailing Listing - 2008-03-13: We just heard the EMC division (Correspondent) was given notice. According to the email we received "Some have until to work until May 30th to receive small severance." The tipster said "They have roughly 30 people left plus some sales staff. That said, that will kill the Conduit and Correspondent division for Bear and look for BSRM to be right behind this."
Also notable in the news today, Bear Stearns (BSC) shares took a dramatic hit on the news about Carlyle Capital's impending collapse. MarketWatch reports:
Original Listing - 2008-01-16: We've been following goings on at Bear Stearns Residential Mortgage Corp., a wholly owned subsidiary of Bear Stearns Companies, since we reported on the gobbling up of Encore Credit. Losses suffered from mortgage-related activities and imploding hedge funds have cost BSC dearly and triggered the ouster of CEO James Cayne, replaced by President Alan Schwartz. That makes it the 4th company to do so in as many months.
Layoffs have been an ongoing saga that ended with many folks being displaced with the closure of operations in Irvine, CA. There have been additional cuts at the Scottsdale AZ home office, and other branch closures. According to Reuters:
There were approximately 1500 employees at the beginning of 2007, but reported cuts now total in excess of 650. Exact numbers could not be verified, but of the four remaining locations shown on CityTownInfo only the AZ office remains in operation (the TX branch is EMC Loan Servicing).
We use the term 'layoffs' loosely here. Former employees found the news releases hardly amusing. Bear Stearns came out with a statement for newspapers that employees would get severance, and we got emails stating it was a lie. This viewpoint was shared in our November Premium newsletter; here's a quote from a former employee:
It is perhaps best summed by this quote from a recent article in The Australian:
If you can provide more info email us please. This story may not have a happy ending.
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Important: This company is on our list of lending operations that have "imploded". However, please note that "imploded" is a somewhat subjective and does not necessarily mean operations are ceased permanently: it can mean bankruptcy filing, temporary but open-ended halting of major operations, or "firesale" acquisition. All information here is provisional, and may contain inaccuracies (especially newer information). If you are planning on doing business with this company or any other one listed on this site, you should inquire with them directly on whether they can still meet your needs. Many are still operating in some capacity.