Supplemental Facts about the Sale of Indymac F.S.B. to OneWest Bank
- IndyMac was competitively bid. After analysis, the acquisition by OneWest represented the least cost transaction to the Deposit Insurance Fund.
- OneWest not only acquired assets, but also assumed the liabilities of the insured deposits, Federal Home Loan Bank Advances, and amounts owed the FDIC
- OneWest has assumed a first loss position on a portfolio of qualifying loans where they take the first 20% of losses before any loss share payments are made. This is a first loss position of over $2.5 billion.
- The FDIC has yet to make a single loss share payment to OneWest.
- In its agreement with FDIC, OneWest is required to adhere to a loan modification protocol for single family loans that meets the approval of the FDIC. If the FDIC determines that OneWest is in violation of this agreement, then the FDIC can repudiate the loss share claims on the covered loans.
- FDIC has authorized OneWest to service single family loans under the Home Affordable Modification Program. It applies to all owner-occupied homes and requires OneWest to:
- follow HAMP procedures to develop affordable loan modification terms for the borrower
- determine whether the recovery on a modified loan is higher than the recovery from a short sale or foreclosure
- modify the loan using HAMP guidelines if the recovery of a modification is higher than the recovery of a short sale or foreclosure
- loss share coverage cannot be factored into any recovery calculation for loan modification, short sale or foreclosure.
- The FDIC monitors OneWest's compliance with their adherence to the FDIC Mortgage Loan Modification Program and OneWest's commitments under the asset sale agreement.
- Only 7% of loans OneWest services are owned by OneWest and covered under loss share. Other institutions own the remaining 93% of loans OneWest services. These loans are required to be serviced in accordance with the owner institutions' agreements with OneWest.