PaineWebber Inc. and Freddie Mac are teaming up to make securitization easier for smaller lenders. New South Federal Savings Bank is the first beneficiary of the program, which provides credit guarantees, structuring, and distribution for modestly sized packages of home loans.

The program enabled the Birmingham, Ala., lender late last month to securitize and sell directly to Wall Street $215.4 million of mortgages. This was preferable to holding the loans in portfolio or selling them on a whole loan basis to a larger lender, said Roger Murphree, capital markets chief at New South Federal, which has $900 million of assets.

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