ROME - Ocwen Financial Corp., a West Palm Beach, Fla., company that buys mortgages and mortgage securities, said it will set up a company with FBS SpA to service Italian mortgage loans.

Ocwen.FBS SpA will be the "first international servicer of distressed Italian mortgages," and Ocwen Financial and FBS will each own half of the company.

The Italian government last year approved regulations allowing banks and companies to convert loans into tradable securities. The approval created a market worth potentially about $104 billion, and since then Italy's financial institutions have started to convert nonperforming loans into tradable securities.

"We see the Italian market offering extremely interesting market opportunities," said William Erbey, chairman and chief executive of Ocwen.

- Bloomberg News

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