Add securitization to the list of activities in which Norwest Mortgage Inc. has become No. 1 since it bought Prudential Home Mortgage.

The Des Moines unit of Norwest Corp. sold $17.9 billion of loans through Fannie Mae, Freddie Mac, and Ginnie Mae during the first four months of this year, a new listing shows.

The securitization volume toppled from the top spot longtime leader Countrywide Home Loans, which issued $13.2 billion, according to the ranking by Mortgage Marketplace, an American Banker newsletter.

The combining of Norwest and Prudential this spring had already created the industry's largest servicer and originator.

Originations serve as the fodder for mortgage-backed securities, and Norwest has always been able to serve up loans. The company had $33.9 billion of originations last year, while Prudential Home Mortgage had $15.7 billion.

Norwest's originations come primarily from mainstream lending through more than 700 offices. Prudential's came primarily from such nontraditional channels as telemarketing, affinity programs, and a corporate relocation unit.

The complementary firepower will allow the combined company to grow larger, executives say. "It's a very good combination," said Geoffrey Dreyer, Norwest executive vice president for loan production administration.

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Traders are buzzing over a new accounting rule they say will hurt the market for mortgage-backed securities.

The rule, expected to be adopted before month's end, involves dollar rolls. In this practice, traders obtain mortgage securities from some investors to place them with others.

Right now, Wall Street accounts for the activity as a buy and sell order. But the Financial Accounting Standards Board wants to reclassify the transactions as borrowings. The board believes the move is necessary to treat broker-dealers' accounting the same as investors'.

But traders, led by the Public Securities Association, oppose the change, saying it would create a less efficient market. The move is unnecessary, "given its potential negative impact on market liquidity," said Thomas K. Guba and Daniel Minerva, chairmen of separate PSA divisions, in a letter to the board last month.

Traders have another reason for opposing the rule, said Halsey Bullen, an FASB project manager. The measure would require them to hold more capital on their books to make their operations appear less risky, he said.

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