Magazine article American Banker

NationsBank Tacking toward Mortgage Top Spot

Magazine article American Banker

NationsBank Tacking toward Mortgage Top Spot

Article excerpt

The home mortgage industry may be one of the first fields to feel the reverberations of NationsBank's acquisition of Boatmen's Bancshares.

The megadeal would vault NationsBank into an exclusive club of six companies that each service more than $100 billion of mortgages. And by greatly strengthening NationsBank's presence in the Midwest, the deal positions the company for national leadership in mortgage originations.

The new heft - including a 25% jump in loans serviced - could well sharpen the company's competitive edge in an industry racing to achieve new economies of scale.

"I want to be the lowest-cost provider," declared Andrew D. Woodward, president of NationsBanc Mortgage Corp.

NationsBanc Mortgage, based in Charlotte, N.C., processes monthly payments on $81.4 billion of loans, and St. Louis-based Boatmen's handles $20.2 billion.

The other servicers with $100 billion or more are Norwest Mortgage Inc. in Des Moines; Countrywide Credit Industries in Pasadena, Calif.; GE Capital Mortgage Corp. in Raleigh, N.C.; Fleet Mortgage Group in Columbia, S.C.; and Chase Manhattan Mortgage Corp. in Edison, N.J.

Mr. Woodward, in his first interview since the deal was announced, said the deal would significantly boost his company's business in government insured mortgages.

"We're typically more conventional-loan oriented, while they have a bit higher government concentration," Mr. Woodward said.

Mr. Woodward, as head of the larger organization, is widely expected to take the helm of the combined operation and bring along many of his lieutenants.

Mr. Woodward declined to discuss the future of Boatmen's personnel, including William K. Carson, chairman of Memphis-based Boatmen's National Mortgage.

"We're just meeting each other," Mr. Woodward said.

One executive with Boatmen's mortgage group said he believes there would be room for plenty of representation from both sides. …

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