Fitch Affirms Ocwen's Resi Servicer Ratings.

Business Editors

NEW YORK--(BUSINESS WIRE)--Dec. 4, 2003

--Fitch Ratings affirms the residential primary servicer ratings for Ocwen Financial Corporation (Ocwen) of 'RPS2' for residential primary servicer of subprime product and 'RSS2' for residential special servicer. In addition, all of the servicer's ratings remain on Rating Watch Negative, pending Fitch's determination of the impact of recently filed class action lawsuits.

Ocwen's 'RPS2' rating for subprime product is based upon the company's proven capabilities in loan administration functions such as investor accounting and reporting, cash management controls and effective collection practices. The 'RSS2' rating for special servicing is based upon the firm's creditable record of performance in resolving a high percentage of delinquent loans prior to foreclosure completion. Through refinement of successful practices and procedures over time, Ocwen has developed the expertise, processes and dynamic technology to reliably absorb new or seasoned accounts and subsequently reduce and control default timelines and losses. Ocwen has implemented numerous robust proprietary servicing applications, which, combined with its well-trained staff and seasoned default management team, enables the firm to competently meet the challenges of servicing a growing, diverse, subprime portfolio.

As of June 30, 2003, Ocwen serviced over 337,000 loans totaling $33.5 billion in outstanding principal balance, of which $29.4 billion represented subprime loans and $571 million represented subserviced and/or special serviced loans. Ocwen continues to grow its servicing portfolio incrementally via numerous bulk and flow servicing acquisitions. Ocwen currently has four servicing sites located in West Palm Beach, Fla., Orlando, Fla., Bangalore, India and Mumbai, India. Since the majority of Ocwen's servicing is done out of its two India locations, Fitch performed an on-site review of Ocwen's Bangalore and Mumbai operations, and determined that they were operating in accordance with industry standards. This review was done in addition to Fitch's on-site reviews of the West Palm Beach and Orlando platforms.

In March 2003, Fitch affirmed Ocwen's corporate ratings at 'B' for senior obligations. In addition, the Rating Outlook for Ocwen and Ocwen Federal Bank was changed to Stable from Negative, reflecting a reduction in non-core assets and improved liquidity relative to outstanding debt. Although Ocwen has reported an improved earnings trend in the past three quarters, Fitch's corporate rating concerns continue to reflect the company's weak core operating performance, less developed funding profile, potential challenges in transferring servicing operations overseas, and need to maintain servicing portfolio scale.

Over the past year there have been numerous class action lawsuits filed against Ocwen by consumers, citing predatory and deceptive business practices. To date, none of these class action lawsuits have been certified by the courts. Fitch takes these charges very seriously and is concerned about the types of issues that have been alleged by consumers. Fitch will continue to monitor Ocwen's financial and legal situations in order to evaluate any potential impact on Ocwen's loan servicing and operational capabilities. If at any time Fitch determines that Ocwen no longer meets the requirements of a servicer at its current rating level, Fitch will take immediate and definitive action with regard to their servicer rating.

Fitch rates residential mortgage primary, master, and special servicers on a scale of 1 to 5, with 1 being the highest rating. Within each of these rating levels, Fitch further differentiates ratings by plus (+) and minus (-) as well as the flat rating. For more information on the review and rating process for servicers, see Fitch research on 'Residential Mortgage Servicer Ratings', dated Feb. 21, 2003, available on Fitch Ratings web site at 'www.fitchratings.com'.