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TheStreet Open House

Wilbur Ross Discusses Ocwen Chairman Bill Erbey

TheStreet:

You mentioned some of his earlier, you know, difficulties with the company and said that you're not as familiar with what went on there, but do you have a sense, I mean I guess I'm trying to get a sense of this is a guy who, you know, he was head of GE Mortgage insurance. You know he spent decades building this mouse trap, which works so well now. I mean do you think it's sort of that the industry, the mortgage servicing industry kind of evolved to the point where it was, you know, kind of his moment, or do you think that it's something that he did to turn his fortunes around? I mean his net worth, I think, has roughly quintupled in the last two years to about 2.3 billion.

Ross:

Right.

TheStreet:

So, you know, quite a dramatic thing for somebody who has been doing the same thing more or less for, you know, 20 or 30 years.

Ross:

Well, I think it's a combination of the two. It is certainly true that there was an unprecedented amount of MSRs coming up for sale. So the environment for building a big business certainly was there. On the other hand it's not easy to onboard huge amounts of MSRs, get them off of someone else's system, get them on to your system and not have all sorts of interruptions, and service problems, and all that. So it is certainly true that in the last couple of years he has been faced with an enormous opportunity.

So has everyone else in the mortgage servicing business, and yet how many of them have achieved what he has achieved? There are very few companies in any kind of mass consumer debt processing that could absorb the amount of inflow, just the number of transactions, the number of systems conversions, the number of staff people that you have to inculcate with a new corporate culture. That's a really hard thing to do because remember the mortgage servicing business is not mainly kind of Goldman Sachs (GS) partners, it's mainly clerical people. And it's very difficult to get clerical people to, a large mass of them, to be the most efficient people over and over and over and yet maintain the service. So I think what has happened is, yes, he was faced with a probably unparalleled opportunity, but you notice not a lot of people were able to grab it.

-- Written by Dan Freed in New York.

Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.
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