GEORGE TOWN, Grand Cayman, Feb. 7, 2013 (GLOBE NEWSWIRE) -- Home Loan Servicing Solutions, Ltd. ("HLSS" or the "Company") (Nasdaq:HLSS) today reported net income of $14.3 million, or $0.44 per ordinary share, for the fourth quarter of 2012.
Fourth quarter business performance highlights:
- Earned $14.3 million, or $0.44 per ordinary share.
- Declared October dividend of $0.11 per ordinary share and November and December dividends of $0.12 per ordinary share totaling $13.7 million for the quarter.
- Completed in October the issuance of $250 million one-year and $450 million three-year term notes secured by servicing advance receivables at a weighted average interest spread over LIBOR of 1.55%. The proceeds were used to repay $600 million in term notes and to reduce borrowing on variable funding notes with a weighted average interest spread of 2.93%.
- Received gross proceeds of $480.7 million from the December 24 follow-on offering of 25,300,000 ordinary shares at $19.00 per share. Proceeds from the offering and two new variable funding notes with a total commitment of $1.6 billion were used to acquire non-agency mortgage servicing assets from Ocwen representing mortgages with an unpaid principle balance of $34.6 billion.
- Earnings include a $0.03 per share benefit from lower than expected amortization resulting from the 13.3% annualized prepayment rate for the fourth quarter versus the benchmark rate of 15%. There was no change in servicing asset valuations during the fourth quarter.
Subsequent to the end of the fourth quarter of 2012:
- On January 15, the Company's Board of Directors declared a monthly dividend of $0.12 per ordinary share for the month of January 2013.
- On January 22, the underwriters exercised a portion of their over-allotment option from the December 24 offering of ordinary shares in the amount of 970,578 shares for which the Company received net proceeds of $17.6 million.
- On January 22, completed the issuance of $650 million one-year, $350 million three-year and $150 million five-year term notes secured by servicing advance receivables at a weighted average interest spread over LIBOR of 0.94%. Total proceeds of $1.15 billion were used to reduce borrowings on variable funding notes with a weighted average interest rate of one-month LIBOR plus 2.32%. The aggregate commitments on our variable funding notes were reduced from $2 billion to $1 billion.
- On February 7, the Company's Board of Directors declared a monthly dividend of $0.13 per ordinary share for February and March 2013.