Origen Financial Announces Fourth Quarter And Full Year 2012 Results

SOUTHFIELD, Mich., Feb. 20, 2013 /PRNewswire/ -- Origen Financial, Inc. (Pink Sheets: ORGN) ("Origen" or the "Company"), a real estate investment trust that manages residual interests in securitized manufactured housing loan portfolios, today announced a net loss of $70,000 for the quarter ended December 31, 2012, as compared to a net loss of $3.1 million, or $0.12 per common share, as restated for the fourth quarter of 2011.  For the full year the Company recorded a net loss of $1.4 million, or $0.05 per common share as compared to a net loss of $10.5 million, or $0.41 per common share as restated, for the year ago period.

As reported in the Company's third quarter 2012 earnings press release, the restatement of 2011 results was necessitated by interest rate calculation errors by the Bank of New York Mellon in its capacity as indenture trustee for Origen Manufactured Housing Contract Trust 2006-a and Origen Manufactured Housing Contract Trust 2007-a ("the Issuers") which resulted in higher rates on the Issuer's Class A-2 notes than that prescribed by the related indentures.  The restatement resulted in a reduction of interest expense of approximately $0.3 million for the fourth quarter 2011 and approximately $1.3 million for the full year 2011. Such restatements had no impact on cash payments to the Company relating to its residual interests in the affected securities.

On February 20, 2013, Origen's Board of Directors declared a common stock dividend of $0.08 per share to be paid to holders of Origen's common stock of record on March 4, 2013.  The dividend will be paid on March 11, 2013 and will approximate $2.1 million. The cash dividend will represent a return of capital.

For the fourth quarter 2012, net interest income before loan losses and impairment decreased by approximately 12 percent to $4.3 million from $4.9 million for the fourth quarter 2011, as restated.  Net interest income before loan losses and impairment for the full year 2012 decreased by approximately 21 percent to $18.1 million from $22.9 million for the full year 2011, as restated.    

Non-interest income for the fourth quarter 2012 increased $0.7 million to $1.6 million from $0.9 million for the year ago quarter, an increase of approximately 78 percent.  For the full year 2012, non-interest income was $9.4 million as compared to $3.7 million for the full year 2011, an increase of $5.7 million, or approximately 154 percent.  The termination of certain interest rate swaps in May 2012 resulted in gains of approximately $6.2 million, which combined with monthly swap cash settlements prior to the terminations, resulted in total income from derivatives of $7.4 million, as compared to derivative income of $3.0 million for the full year of 2011, for a total increase in derivative income of $4.4 million.  The balance of the increase in non-interest income was attributable to $1.4 million in cash payments from AMBAC, as financial guarantor for Origen Manufactured Housing Contract Trust 2007-a and Origen Manufactured Housing Contract Trust 2007-b ("the Trusts").  Such payments represented partial settlement of claims under an assurance obligation by AMBAC and were distributed by the trustee to the bondholders of the Trusts.  The Company received no cash from the AMBAC payments.

The fourth quarter 2012 provision for loan losses was $3.3 million versus $6.0 million for the prior year quarter, a decrease of approximately 45 percent.  The full year 2012 provision for loan losses was $17.4 million as compared to $24.1 million for the year ago period, a decrease of approximately 28 percent.  Decreases in provisions for loan losses reflect the declining balances of the Company's static loan portfolio and improvements in recoveries on dispositions of foreclosed and repossessed properties.

Non-interest expenses, including $1.9 million of loan servicing expense, were $2.7 million for the fourth quarter 2012, as compared to $3.0 million, including $2.2 million of loan servicing expense, for the year ago quarter, a decrease of approximately 10 percent.  Full year 2012 non-interest expenses were $11.4 million, including $7.9 million of loan servicing expense versus the prior year total of $12.9 million, including $9.0 million of loan servicing expense, a reduction of $1.5 million, or approximately 12 percent from the year ago period.

Earnings Call and Webcast

A conference call has been scheduled for Thursday, February 21, 2013, at 11:00 a.m. Eastern Time to discuss fourth quarter and full year 2012 results and current operations.  The call may be accessed by dialing 888-510-1786 or 719-325-2429.  A replay will be available through February 28, 2013 by dialing 877-870-5176 or 858-384-5517 pass code 4310532. 

Forward-Looking Statements

This press release contains various "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, and Origen intends that such forward-looking statements will be subject to the safe harbors created thereby. The words "will," "may," "could," "expect," "anticipate," "believes," "intends," "should," "plans," "estimates," "approximate" and similar expressions identify these forward-looking statements. These forward-looking statements reflect Origen's current views with respect to future events and financial performance, but involve known and unknown risks and uncertainties, both general and specific to the matters discussed in this press release. These risks and uncertainties may cause Origen's actual results to be materially different from any future results expressed or implied by such forward-looking statements. Such risks and uncertainties include, among others, the foregoing assumptions and those risks referenced under the headings entitled "Factors That May Affect Future Results" or "Risk Factors" contained in Origen's filings. The forward-looking statements contained in this press release speak only as of the date hereof and Origen expressly disclaims any obligation to provide public updates, revisions or amendments to any forward- looking statements made herein to reflect changes in Origen's expectations or future events.

About Origen Financial, Inc.

Origen is an internally managed and internally advised company that has elected to be taxed as a real estate investment trust. Origen is based in Southfield, Michigan.

For more information about Origen, please visit http://www.origenfinancial.com.

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SOURCE Origen Financial, Inc.