Ocwen Financial Corp. recorded an additional $50 million expense tied to a settlement with New York's financial regulator and expects to take a non-cash goodwill charge of as much as $420 million in the fourth quarter.
The mortgage servicer hired Moelis & Co. and Barclays Plc to help it explore "strategic options," the Atlanta-based firm said Monday in a statement. Ocwen also said that it signed a letter of intent to sell a portfolio of rights to collect payments on performing agency mortgages with an unpaid principal balance of about $45 billion.
The costs are the latest setback for Ocwen, the largest nonbank servicer of U.S. mortgages, which has faced attacks from regulators and bond investors. Executive Chairman William Erbey stepped down from his roles at Ocwen and related companies under a December settlement with New York Department of Financial Services Superintendent Benjamin Lawsky that prevents the firm from acquiring mortgage-servicing rights until it makes improvements to its processes.
Ocwen said the servicing-rights transaction is expected to be completed by midyear. Such sales in the first half of 2015 will generate about $550 million in proceeds.
Mortgage servicers handle billing and collections on behalf of lenders or investors who own the loans, and oversee foreclosures when borrowers default.
Ocwen rose 2.8 percent to $8.78 at 4:52 p.m. in extended trading in New York. The shares fell 43 percent this year through the close of regular trading.