New Century Announces the Completion of the Ocwen Transaction; Ocwen Federal Bank FSB Purchased New Century's Servicing Rights

Apr 02, 2001, 01:00 ET from New Century Financial Corporation

    IRVINE, Calif., April 2 /PRNewswire/ -- New Century Financial Corporation
 (Nasdaq:   NCEN) announced today that its wholly-owned subsidiary, New Century
 Mortgage Corporation, has completed the sale to Ocwen Federal Bank FSB of
 approximately $4.8 billion of New Century's servicing portfolio, for
 $19.7 million.  The actual amount of servicing rights purchased was adjusted
 slightly downward from the $4.9 billion previously announced to reflect
 amortization and loan payoffs in the portfolio during the first quarter of
 2001.
     New Century will retain approximately $700 million in mortgage servicing
 rights.  Ocwen also assumed responsibility of all New Century's outstanding
 servicing advance receivables and responsibility for all future servicing
 advance obligations relating to the purchased portfolio.
     With the cash proceeds from this transaction, New Century a) repaid the
 portion of its warehouse line of credit secured by servicing advances, b)
 repaid the outstanding balance on its $22.5 million working capital line of
 credit with U.S. Bank, c) purchased interest rate "hedge" protection for the
 residual cash flows, and d) increased its liquidity.
     "We are extremely pleased with the professional manner in which all
 parties contributed their efforts in making this a smooth and timely closing,"
 said Robert K. Cole, Chairman and Chief Executive Officer.  "We believe that
 Ocwen's outstanding loan servicing expertise will provide comfort to investors
 that the portfolio will be serviced to maximize the value of bondholders'
 investments," added Cole.
     The servicing transfer to Ocwen is scheduled to be completed by August 1,
 2001.  New Century will utilize its existing platform to sub-service loans for
 Ocwen during the transition.  After the transfer Ocwen will service the loans
 in New Century's existing securitized transactions and will also provide
 interim servicing of New Century's loans held for sale.
 
     New Century Financial Corporation is a specialty finance company that,
 through its subsidiaries, originates, purchases, sells, and services mortgage
 loans secured primarily by first mortgages on single family residences.
 
     Safe Harbor Regarding Forward-Looking Statements
     Certain statements contained in this press release may be deemed to be
 forward-looking statements under federal securities laws, and the Company
 intends that such forward-looking statements be subject to the safe-harbor
 created thereby.  Such forward-looking statements include (i) the expectation
 that Ocwen's loan servicing expertise will provide comfort to investors that
 the portfolio will be serviced to maximize the value of bondholders'
 investments, and (ii) the expectation that the transfer of the servicing
 portfolio will be completed by August 1, 2001.  The Company cautions that
 these statements are qualified by important factors that could cause actual
 results to differ materially from those reflected by the forward-looking
 statements.  Such factors include, but are not limited to (i) Ocwen's ability
 to perform its obligations and maintain high quality servicing operations, and
 (ii) the ability of the parties to preserve the Company's servicing platform
 pending closing and during the period preceding the transfer.  Additional
 information on these and other factors is contained in the Company's Annual
 Report on Form 10-K for the year ended December 31, 2000 and its other
 periodic filings with the Securities and Exchange Commission.
 
 

SOURCE New Century Financial Corporation
    IRVINE, Calif., April 2 /PRNewswire/ -- New Century Financial Corporation
 (Nasdaq:   NCEN) announced today that its wholly-owned subsidiary, New Century
 Mortgage Corporation, has completed the sale to Ocwen Federal Bank FSB of
 approximately $4.8 billion of New Century's servicing portfolio, for
 $19.7 million.  The actual amount of servicing rights purchased was adjusted
 slightly downward from the $4.9 billion previously announced to reflect
 amortization and loan payoffs in the portfolio during the first quarter of
 2001.
     New Century will retain approximately $700 million in mortgage servicing
 rights.  Ocwen also assumed responsibility of all New Century's outstanding
 servicing advance receivables and responsibility for all future servicing
 advance obligations relating to the purchased portfolio.
     With the cash proceeds from this transaction, New Century a) repaid the
 portion of its warehouse line of credit secured by servicing advances, b)
 repaid the outstanding balance on its $22.5 million working capital line of
 credit with U.S. Bank, c) purchased interest rate "hedge" protection for the
 residual cash flows, and d) increased its liquidity.
     "We are extremely pleased with the professional manner in which all
 parties contributed their efforts in making this a smooth and timely closing,"
 said Robert K. Cole, Chairman and Chief Executive Officer.  "We believe that
 Ocwen's outstanding loan servicing expertise will provide comfort to investors
 that the portfolio will be serviced to maximize the value of bondholders'
 investments," added Cole.
     The servicing transfer to Ocwen is scheduled to be completed by August 1,
 2001.  New Century will utilize its existing platform to sub-service loans for
 Ocwen during the transition.  After the transfer Ocwen will service the loans
 in New Century's existing securitized transactions and will also provide
 interim servicing of New Century's loans held for sale.
 
     New Century Financial Corporation is a specialty finance company that,
 through its subsidiaries, originates, purchases, sells, and services mortgage
 loans secured primarily by first mortgages on single family residences.
 
     Safe Harbor Regarding Forward-Looking Statements
     Certain statements contained in this press release may be deemed to be
 forward-looking statements under federal securities laws, and the Company
 intends that such forward-looking statements be subject to the safe-harbor
 created thereby.  Such forward-looking statements include (i) the expectation
 that Ocwen's loan servicing expertise will provide comfort to investors that
 the portfolio will be serviced to maximize the value of bondholders'
 investments, and (ii) the expectation that the transfer of the servicing
 portfolio will be completed by August 1, 2001.  The Company cautions that
 these statements are qualified by important factors that could cause actual
 results to differ materially from those reflected by the forward-looking
 statements.  Such factors include, but are not limited to (i) Ocwen's ability
 to perform its obligations and maintain high quality servicing operations, and
 (ii) the ability of the parties to preserve the Company's servicing platform
 pending closing and during the period preceding the transfer.  Additional
 information on these and other factors is contained in the Company's Annual
 Report on Form 10-K for the year ended December 31, 2000 and its other
 periodic filings with the Securities and Exchange Commission.
 
 SOURCE  New Century Financial Corporation