- Completed legacy ResCap system migration
- Recorded $100 million charge for potential settlement with New York regulator
- Surpassed 500,000 loan modifications milestone
ATLANTA, Oct. 30, 2014 (GLOBE NEWSWIRE) — Ocwen Financial Corporation, (NYSE:OCN), a leading financial services holding company, today reported a Net loss of $(75.3) million, or $(0.58) per share, for the third quarter of 2014 compared to Net income of $60.6 million, or $0.39 per share, for the third quarter of 2013. Ocwen generated revenue of $513.7 million, down 3% compared to the third quarter of 2013. Income from operations was $58.7 million for the third quarter of 2014.
Net income for the nine months ended September 30, 2014 was $52.2 million, or $0.36 per share, as compared to $175.1 million, or $1.17 per share, for the same period in 2013. Revenue for the first nine months of 2014 increased 9% from the first nine months of 2013 to a total of $1.6 billion.
Pre-tax loss on a GAAP basis for the third quarter of 2014 was $(72.3) million, a 194% decrease as compared to the second quarter of 2014. During the third quarter of 2014, Ocwen incurred a total of $137 million in normalized expenses. Ocwen’s normalized pre-tax earnings were $64.8 million, a 41% decrease from the second quarter of 2014. Normalized pretax earnings were impacted by $120.0 million of reserves for various regulatory and legal matters, including a $100.0 million accrual for a potential settlement with the New York Department of Financial Services, $9.0 million for Fair Value changes and $8.1 million of integration, technology-related and severance costs. We have not reached any agreement with the New York Department of Financial Services and cannot predict whether or when we may reach such a resolution. Any future resolution of these regulatory and legal matters may be materially different from what has been accrued.
“I want to emphasize that Ocwen takes great efforts to keep borrowers in their homes and to avoid foreclosures,” commented Bill Erbey, Ocwen’s Executive Chairman. “Ocwen recently reached a significant milestone by making its 500,000th loan modification, including 290,000 HAMP modifications. Ocwen is the leader in foreclosure prevention with 44% more HAMP modifications than any other servicer. We work very hard to keep borrowers in their homes and that is why we take the concerns raised by the New York Department of Financial Services so seriously. We have numerous compensating controls in place which we believe should have prevented borrower harm. Nonetheless, Ocwen is proactively creating a process whereby any borrower, who believes they received a misdated letter, and were harmed as a result, will have the opportunity to receive a complete file review to resolve any issues caused by the misdating.”