Fitch Ratings has assigned the following U.S. residential mortgage servicer rating to Statebridge Company, LLC’s (Statebridge) sub-servicer mortgage operations:
–Initial U.S. residential primary specialty-subservicer rating ‘RPS3-‘; Outlook Stable.
Statebridge was established in 2008 and is majority-owned by FrontRange Capital Partners, LLC (FrontRange), a private equity firm. Other key owners are Kevin Kanouff, chief executive officer and David McDonnell, managing director. In addition, on June 23, 2014, Jay Memmott, with over 35 years of industry experience joined the company as the new president and chief operating officer. FrontRange acquired a majority interest in Statebridge during the third quarter of 2013, after the prior joint business arrangement with Integrated Asset Services (IAS), a portfolio company of MBH Holdings ended.
Fitch assigned the specialty subservicer rating based on Statebridge’s evidenced servicing capabilities. Also, Fitch believes that Statebridge has an experienced senior management team, developed recruiting, staffing, and retention programs, and developed loan and default administration capabilities. The rating also takes into consideration Statebridge’s financial and business support from its parent company. In addition, the rating also considers Statebridge’s limited operating history, recent change in ownership, and current portfolio size.
As of June 30, 2014, Statebridge sub-serviced 5,675 loans for approximately $1.08 billion. The servicer recently completed several strategic arrangements and is expanding its operation. The company anticipates that its portfolio will increase to 10,000 loans by year-end 2014.
Fitch’s on-site observations are that Statebridge maintains an experienced servicing staff which is adequate for the size and type of portfolio currently being serviced. The servicer utilizes both vendor provided and its customized systems to adequately manage its portfolio. As of July 1, 2014, the servicer had 63 full time equivalents.
Fitch will continue to monitor Statebridge’s expansion and success in growing its mortgage servicing operations.