|Citigroup Sells Mortgage Rights to Wilbur Ross Unit (Update2)
By Josh Fineman and Bradley Keoun - February 5, 2009 17:27 EST
Feb. 5 (Bloomberg) -- Citigroup Inc., the U.S. bank that’s shedding businesses
after last year’s record $18.7 billion loss, agreed to sell the
billing-and-collections rights on 185,000 mortgages to Wilbur Ross’s American
Home Mortgage Servicing Inc.
Citigroup will get $1.5 billion, Irving, Texas-based American Home said in an
e-mailed statement. The amount includes rights to mortgage-servicing fees as
well as temporary advances Citigroup made to mortgage investors on behalf of
delinquent borrowers, the company said. The transaction had no material impact
on overall results, said Mark Rodgers, a spokesman for the New York-based bank.
The deal lets Citigroup wind down Citi Residential Lending, a unit formed in
September 2007 when the bank bought mortgage-servicing rights on $45 billion of
loans from ACC Capital Holdings, parent of the now-shuttered subprime lender
Ameriquest Mortgage Co., Rodgers said. The bank consolidated its mortgage
operations in early 2008 and decided not to maintain Citi Residential Lending’s
“In order to realize cost efficiencies in the current environment, Citi
determined that the sale of these rights was a better alternative to retaining
them,” Rodgers said in an interview. As of Sept. 30, Citi Residential held
servicing rights on about 247,000 loans, compared with about 6 million for
Citigroup’s consumer-banking division.
Mortgage-servicing companies get fees for collecting payments from homeowners
and dealing with borrowers who fail to pay.
Ross, who heads the WL Ross & Co. buyout firm, made billions turning around
distressed steel and textile companies. He bought American Home in October in a
bankruptcy auction. It had been a unit of Melville, New York-based American Home
Mortgage Investment Corp.
In an interview, Ross said the Citigroup loans that American Home will service
have a face value of $37 billion and include subprime and Alt-A mortgages. The
deal, which increases the number of loans American Home services by 45 percent
to about 575,000, will improve the overall efficiency of the operations, Ross
“The loans are a great fit with our existing portfolio,” American Home Chief
Executive Officer David Friedman said in a separate statement distributed by on
Citigroup rose 4 cents to $3.53 at 4:15 p.m. in New York Stock Exchange
composite trading. The shares are down 47 percent this year.
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Bradley Keoun in New York at email@example.com.
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Wilbur Ross, Billionaire Investor, Is Said to Be Trump’s Commerce
By JULIE HIRSCHFELD DAVISNOV. 24, 2016
Continue reading the main story
Wilbur Ross met with President-elect Donald J. Trump at the Trump
National Golf Club in Bedminster, N.J., this week. Credit Hilary
Swift for The New York Times
WASHINGTON — President-elect Donald J. Trump is expected to select
as commerce secretary Wilbur Ross, a billionaire investor who became
known as the “king of bankruptcy” for buying, restructuring and
selling off steel makers and other fading industrial companies,
officials on the transition team said on Thursday.
After choosing national security hard-liners for some of his
earliest appointments, Mr. Trump is now turning to a group of
ultrawealthy conservatives to help steer administration policy.
In addition to Mr. Ross, a generous contributor to his campaign, Mr.
Trump is likely to choose Todd Ricketts, a Republican megadonor who
is an owner of the Chicago Cubs and whose father founded TD
Ameritrade, to be the deputy commerce secretary, the officials said.
And on Wednesday, Mr. Trump said he would name Betsy DeVos, a school
choice activist and Republican fund-raiser, as his education
Graphic: Donald Trump’s Cabinet is Complete. Here’s the Full List.
Mr. Ross, 78, an economic adviser to Mr. Trump’s campaign whose
fortune is estimated by Forbes to be $2.9 billion, is aligned with
Mr. Trump on trade. He says the United States must free itself from
the “bondage” of “bad trade agreements,” and he has advocated
threats of steep tariffs on Chinese goods. Mr. Ross, the chairman of
the private equity firm WL Ross & Company, has also pressed for
cutting the corporate tax rate to 15 percent, from 35 percent, and
reducing taxes and regulations on energy companies.
Continue reading the main story
The Trump White House
The historic moments, head-spinning developments and
inside-the-White House intrigue.
During the general election, he hosted at least one fund-raiser for
Mr. Trump at his home in the Hamptons. There, Mr. Trump, who at the
time was pondering his choice for a running mate, turned his
deliberations into a party game, soliciting opinions from the donors
Mr. Ross also owns a waterfront estate in Palm Beach, Fla., down the
road from Mar-a-Lago, Mr. Trump’s club, which is expected to be his
White House getaway, and where the president-elect was spending
Thanksgiving with his family.
If confirmed by the Senate, Mr. Ross would succeed another wealthy
campaign donor at the helm of an agency charged with promoting
American commercial interests and trade around the world. Penny
Pritzker, President Obama’s commerce secretary, is a billionaire
entrepreneur who was an early financial backer of Mr. Obama and is
an heiress to the Hyatt Hotels fortune.
Unlike Mr. Trump and Mr. Ross, Ms. Pritzker has been a leading
proponent of forging new free-trade agreements. One of her top
priorities was the completion of the Trans-Pacific Partnership, a
sweeping 12-nation accord that Mr. Trump has promised to scrap.
Maggie Haberman contributed reporting from New York.
Billionaire Wilbur Ross Is Expected to Be Easily Confirmed as
Trump Trade Czar Monday
Feb 27, 2017
Billionaire investor Wilbur Ross is expected to be easily confirmed
as U.S. Commerce Secretary on Monday, clearing President Donald
Trump's top trade official to start work on renegotiating trade
relationships with China and Mexico.
The vote will insert a major new voice into Trump's economic team,
one that strongly influenced his criticism of the North American
Free Trade Agreement and a now-scrapped Asia-Pacific trade deal.
Ross' nomination is scheduled for a vote on Monday at around 7 p.m.
It was advanced by the Senate in a 66-31 procedural vote on Feb. 17,
signaling solid support from Democrats.
Part of that support stems from praise that Ross has drawn from the
United Steelworkers union for his efforts in restructuring several
bankrupt steel companies in the early 2000s, saving numerous plants
and thousands of jobs.
But he also has come under criticism from some left-wing groups as
another billionaire in a Trump cabinet that claims to be focused on
the working class, and for being a "vulture" investor who has
eliminated jobs. Reuters reported last month that Ross's companies
have shipped some 2,700 jobs overseas since 2004.
The 79-year-old investor will oversee a sprawling agency with nearly
44,000 employees responsible for combating the dumping of imports
below cost into U.S. markets, collecting census and critical
economic data, weather forecasting, fisheries management, promoting
the United States to foreign investors and regulating the export of
While Commerce secretaries rarely take the spotlight in Washington,
Ross is expected to play an outsize role in pursuing Trump's
campaign pledge to slash U.S. trade deficits and bring manufacturing
jobs back to America.
Trump has designated Ross to lead the renegotiation of NAFTA with
Mexico and Canada, a job that in past administrations would have
been left to the U.S. Trade Representative's office.
Ross will join other major players on the economic team, including
U.S. Treasury Secretary Steven Mnuchin and Gary Cohn, director of
the White House National Economic Council.
Some experts said Ross could serve as a counterweight to advisers
such as Peter Navarro, the University of California-Irvine economics
professor who heads Trump's newly created White House National Trade
Council. Navarro has advocated a controversial 45% across-the-board
tariff on imports from China that Trump threatened during his
"I expect that Ross will quickly become the administration’s chief
trade spokesman, and that Navarro’s influence will be felt
indirectly, rather than through public statements or testimony,"
said Gary Hufbauer, a senior fellow and trade expert at the Peterson
Institute for International Economics.
At his confirmation hearing, Ross downplayed chances of a trade war
with China, while calling it the "most protectionist" large economy.
He vowed to level the playing field for U.S. companies competing
with Chinese imports and those trying to do business in China's
highly restricted economy.
Ross, estimated by Forbes to be worth $2.9 billion, built his
fortune in the late 1990s and early 2000s by investing in distressed
companies in steel, coal, textiles and auto parts, restructuring
them and often benefiting from tariff protections put in place by
the Commerce Department.
A crucial player in President Trump's trade agenda will finally
be allowed to get on the field.
The U.S. Senate voted 72-27 on Monday evening to confirm billionaire
Wilbur Ross as Trump's commerce secretary.
The green light comes nearly three months after Trump first tapped
the famed investor for his cabinet and four weeks after a Senate
committee unanimously voted in favor of his nomination.
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But the confirmation vote was not without controversy. Senate
Minority Leader Charles Schumer took to the floor minutes beforehand
to protest the White House refusing to release written answers from
Ross about the Bank of Cyprus, a bank he is vice chairman of that
has links to Russia.
Democrats had demanded Ross explain his connections to Viktor
Vekselberg, a Bank of Cyprus shareholder who is described as a
friend to Russian President Vladimir Putin.
Schumer, who voted against Ross's nomination, said this inquiry was
"perfectly reasonable" given how "questions about connections
between the Trump administration and Russia have proliferated" in
recent days. Schumer called it another example of the Trump
administration "abandoning transparency."
Ross has indicated he will step down from the Bank of Cyprus after
he takes office.
The White House is expected to hold a swearing-in ceremony for the
new commerce secretary on Tuesday prior to Trump's speech to a joint
session of Congress.
Ross is expected to be a powerful figure in the Trump
administration, leading the way on efforts to renegotiate NAFTA, the
controversial trade agreement with Canada and Mexico.
The 79-year-old will also be a key voice on other trade matters as
well as on Trump's efforts to accelerate economic growth by slashing
taxes and ramping up infrastructure spending.
"Much of the administration's trade agenda has been awaiting the
confirmation of Ross, who is the tip of the presidential spear on
trade matters," Chris Krueger, an analyst at Cowen & Co., wrote in a
report on Monday.
Related: 8 reasons Andrew Puzder's nomination flamed out
During his confirmation hearing in mid-January, Ross pushed for
taking a tough stance on China, which he called the "most
protectionist country of very large countries." The commerce
secretary nominee said countries that resort to "malicious" trading
tactics should be "severely" punished.
Known as the "King of Bankruptcy," Ross made a fortune by working to
resurrect failing companies in the auto, steel and textile
But Ross has also been criticized for shipping jobs overseas at some
of those struggling companies, something that Trump has slammed Ford
(F), Carrier and others for doing. Ross led an auto parts company
that moved jobs to Mexico, while a textile firm he founded opened a
cotton plant in Vietnam that would employ 1,500 workers, The New
York Times reported.
Ross has defended his job creation record. During the hearing, he
said International Automotive Components had "no choice" but to move
some jobs to Mexico at the request of a major customer. Ross also
said that overall, the auto parts company created more U.S. jobs
during this period than it eliminated.
He also said International Textile Group "would have had to shut
down far more domestic activities" if it hadn't moved some
"If you add and subtract, we were a very large net creator of jobs"
in the U.S., Ross said.
Related: Democrats fear recession, Republicans see a boom
Ross has also sought to ease concerns about whether the White House
would try to politicize climate science. Ross pledged in a letter to
Democrat Senator Bill Nelson not to censor or intimidate scientists
who work at NOAA, the agency housed within the Commerce Department
that controls the National Weather Service and conducts research.
To avoid potential conflicts of interest, Ross has pledged to sell
most, though not all, of his empire of financial assets once he's
confirmed. The billionaire's ethics agreement was complicated by his
lengthy investing career and wide array of complex assets.
While Ross will step down from the private equity firm he founded in
1997, he plans to remain a passive investor in nine investment
vehicles related to shipping, mortgage lending and real estate
CNNMoney (New York) First published February 27, 2017: 2:37 PM ET