GMAC-RFC is eyeing expansion into Japan.
Bruce Paradis, president of the Minneapolis-based subsidiary of General Motors Acceptance Corp., said he has interviewed a candidate to head an operation in Japan, where the contraction in the banking system may have created new opportunity.
GMAC-RFC believes there is "a need for a conduit type of business to bring new capital to consumer finance" in Japan, Mr. Paradis said in an interview at last week's Mortgage Bankers Association conference in Boston.
GMAC-RFC is the largest nonagency issuer of private-label mortgage-backed securities in the United States, with $18 billion of deals in the first nine months of this year. It specializes in jumbo mortgage, home equity, high-loan- to-value loans, and commercial real estate loans. It is the second-largest warehouse lender to mortgage banks, with $7 billion of lines outstanding.
Faced with a mature domestic mortgage market and cyclical slowdown in the U.S. housing sector, GMAC-RFC is one of several big American mortgage companies looking to export its technology and expertise. But to date, most of the focus has been on Europe, the United Kingdom, and Latin America.
Angelo Mozilo, the chairman and chief executive officer of Countrywide Credit Industries, told reporters at the convention that the Calabasas, Calif., mortgage bank hopes to become a "major mortgage player" in Europe by 2004.
Countrywide formed a joint venture in May with Woolwich PLC, a British mortgage bank, to gain footholds in Paris and Milan as well as the U.K. Noting the "archaic" systems outside the United States, Mr. Mozilo said he sees near-term opportunities for Countrywide in France and Italy and long- term opportunities in central Europe, Asia, and Latin America.
Mr. Paradis said that this year GMAC-RFC completed its first securitization in Europe and purchased a distressed-asset portfolio in Mexico.
He noted that Fannie Mae and Freddie Mac, government-chartered companies with a mission to increase liquidity in the U.S. housing market, also have become more active in Europe.
With Japan's banking system still reeling from a severe recession, a GMAC- RFC conduit would help restore liquidity in consumer loans by buying loans, which it would then package and sell as securities.
Mr. Paradis said GMAC-RFC remains committed to its warehouse lending, having weathered a downturn in the specialty finance sector.
Warehouse lenders supply interim financing while mortgage banks wait to sell loans in the secondary market. Some lenders pulled back from the business after the market for mortgage loans dried up late last year, putting some clients into bankruptcy.