Wholesaler Launches

On Friday, the Securities and Exchange Commission mailed more than $356 million in checks to defrauded investors who bought or sold shares of Fannie between 1998 and 2004. The funds represent the interest and entire $350 million the Washington, D.C.-based company paid to settle the SEC’s fraud charges in May 2006.

The SEC said Friday’s payments bring to over $3 billion the payments it has distributed since the enactment of the Fair Funds provisions of the Sarbanes-Oxley Act of 2002, which allowed it to send financial penalties from its enforcement actions directly to harmed investors rather than to the U.S. Treasury.

Accredited Mortgage Loan REIT Trust announced it intends to voluntarily delist its 9.75 percent series A perpetual cumulative preferred shares from the New York Stock Exchange. Plus, since there are less than 300 shareholders on record for the shares, it plans to deregister them and the guarantee with the Securities and Exchange Commission. The moves are estimated to result in savings of up to at least $2 million annually in light of current and expected regulatory requirements, especially those resulting from Sarbanes-Oxley Act, Accredited Home Lenders Holding Co. announced.

“Current market conditions do not warrant the significant annual costs associated with our being a reporting company,” and it is prudent to use these funds to enhance the company’s financial performance, Accredited Chairman and Chief Executive James A. Konrath said in the announcement. “As private, non-registered companies, Accredited and REIT will have more flexibility in pursuing strategic opportunities and focusing on and managing their core business.“

Accredited expects to file the Form 15 for deregistration early next month and have this become fully effective within 90 days or by early February.

Capital One Financial Corp. announced a third quarter net loss of $81.6 million, compared to earnings of $587.8 million a year earlier. The results of the last three months included an $898 million loss related to the closure of GreenPoint Mortgage in August. The shutdown is largely complete and led to higher-than-anticipated charges due to increased valuation adjustments. The company expects to incur another $23 million in aftertax charges associated with the unit in the fourth quarter and into early 2008.

On Tuesday, Fremont General Corp. filed with the SEC its overdue 2006 annual report and first and second quarter 2007 financial reports. The filings, which come seven months after it was ordered to stop doing subprime loans, showed a net loss of over $202 million for 2006 and even worse performance for the first half of 2007 — a net loss of $856 million mainly due to losing $879 million on the sale of $6.9 billion in subprime loans.

Furthermore, the Santa Monica, Calif.-based lender expects reduced revenue stream for at least the remainder of this year due to exiting residential real estate lending and selling its commercial real estate lending business and related loan portfolio. It anticipates incurring a net loss from continuing operations for at least the remainder of the year as well.

The Federal Reserve Board approved for ICICI Bank Ltd., the second-largest bank in India, to establish a federal branch in New York, N.Y. The branch will engage in wholesale banking, including providing lending, trade financing, and factoring services to U.S.-based subsidiaries of Indian companies. ICICI currently operates a representative office in New York and engages indirectly in U.S. nonbank activities through a number of subsidiaries.

First National Bank of Nassau County has launched a wholesale lending division, parent Coastal Banking Company Inc. announced today. The Atlanta-based unit will initially operate in the metro Atlanta and Charlotte markets, though it plans to expand once established.

Part of the motivation to launch the unit was a recent reduction in competition and nominal incremental operational costs, the statement said. A conservative program menu will include only full-documentation, conforming mortgage loans that are pre-sold into the secondary market.