Bear Stearns Completes Acquisition of ECC Capital's Subprime Mortgage Origination Unit.NEW YORK New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of -- The Bear Stearns Companies Inc. (NYSE NYSE See: New York Stock Exchange : BSC (Binary Synchronous Communications) See bisync. ) has completed its purchase of ECC (1) (Error-Correcting Code) A type of memory that corrects errors on the fly. See ECC memory. (2) (Elliptic Curve Cryptography) A public key cryptography method that provides fast decryption and digital signature processing. Capital Corporation's (NYSE: ECR ECR Efficient Consumer Response ECR European Congress of Radiology ECR Electron Cyclotron Resonance ECR El Camino Real (Kings Highway; California) ECR Electronic Cash Register ECR East Coast Radio (South Africa) ) subprime mortgage banking platform for approximately $26 million, the two companies announced today. Bear Stearns announced the agreement to purchase the principal assets of the subprime mortgage origination platform of ECC Capital's subsidiary, Encore Credit Corp., in October 2006. Encore Credit will retain its brand name and operate as a separate division of the firm's mortgage bank subsidiary, Bear Stearns Residential Mortgage Corporation (Bear Res). Shabi Asghar, formerly ECC Capital's President and Co-CEO, has joined Bear Stearns as Encore Credit's President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . "We are extremely excited to be welcoming nearly 660 people from Encore Credit to Bear Stearns," said Jeff Verschleiser, co-head of mortgage trading for Bear Stearns. "This deal is the next step in the vertical integration of our dynamic mortgage franchise by providing us with a significant stake in the subprime market." Combined, Bear Res and Encore Credit will generate more than $1 billion in conforming, Alt-A and subprime loans per month. As part of the acquisition, Bear Stearns will take over Encore Credit's operating centers in Irvine, Cal., Downers Grove, Ill. and Glen Allen, Va. Bear Stearns also acquired $1.2 billion of ECC's whole loan portfolio. The $26 million purchase price for the Encore Credit platform was credited against certain amounts due Bear Stearns, including warehouse borrowings. About The Bear Stearns Companies Inc. Founded in 1923, The Bear Stearns Companies Inc. (NYSE: BSC) is a leading financial services firm serving governments, corporations, institutions and individuals worldwide. The Company's core business lines include institutional equities, fixed income, investment banking, global clearing services, asset management, and private client services. Headquartered in New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. , the company has approximately 13,500 employees worldwide. For additional information about Bear Stearns, please visit the firm's web site at www.bearstearns.com. About ECC Capital Corporation ECC Capital Corporation, headquartered in Irvine, Calif., is a mortgage real estate investment trust (REIT REIT See: Real Estate Investment Trust REIT See real estate investment trust (REIT). ) that invests in residential mortgage loans. ECC Capital is currently structured to qualify as a REIT by managing a portfolio of nonconforming loans it originates or acquires. As a REIT, ECC Capital is required to distribute dividends to its stockholders from net income generated from the spread between the interest income on its assets in its portfolio and the costs of capital to finance its acquisition of these assets. |
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