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| Thornburg Mortgage Inc. said today that it planned to file for bankruptcy and liquidate its assets.The former jumbo lender has been warning about its ongoing viability ever since the secondary market for jumbo loans seized up. Thornburg first halted originations in August 2007 when it was hit with a series of crippling margin calls.
Creditors of the Santa Fe, N.M.-based company have repeatedly renegotiated and extended agreements as Thornburg frantically worked to drum up capital. But Thornburg apparently succumbed to the virtual disintegration of the non-agency market. In an announcement today, Thornburg said it has agreed to surrender collateral backing financing agreements with counterparties including JPMorgan Chase Funding Inc., Citigroup Global Markets Limited and Credit Suisse Securities (USA) LLC. Other impacted counterparties include Credit Suisse International, Greenwich Capital Markets Inc. and Greenwich Capital Derivatives Inc. as well as The Royal Bank of Scotland plc and UBS AG. In exchange for the surrender of collateral, the counterparties agreed to delay additional payment demands on deficiency claims until April 30. Thornburg will transfer the servicing rights as part of the deal. “As a result of the events mentioned above, the company expects to file for Chapter 11 bankruptcy protection,” the news release stated. “The company also intends to commence an orderly sale or liquidation of its remaining assets.” Houlihan Lokey Howard & Zukin Capital Inc. will assist in the liquidation. Thornburg said it plans no 10-K annual report filing with the Securities and Exchange Commission. |
