The securities are backed by more than 7,500 home equity loans - or first and second mortgages primarily used for refinancing mortgages, debt consolidation or other personal uses - in 43 states and Washington, D.C. The loans were originated or acquired by subsidiaries of First Union Corporation.
"We are very pleased with this transaction - from the origination and pooling of the loans to the securitization and pricing," said Wes Jones, managing director of First Union Corp.'s Mortgage Finance Group. "This fully integrated approach enables First Union to provide seamless execution on all phases of a transaction. This deal underscores our growth and success in the home equity securities market."
The certificates are guaranteed by Freddie Mac. Earlier this year, First Union Capital Markets Corp. and Lehman completed two other Freddie Mac-guaranteed home equity securitizations totaling $260 million and $220 million.
The closed-end, fixed-rate loans were originated or acquired through First Union's Home Equity Bank, a First Union Corp. subsidiary which operates 119 locations in 35 states nationwide, and throughout First Union's consumer branch network. First Union has provided subprime home equity loans through the Home Equity Bank since 1993 and began offering that product in bank branches earlier this year to meet customers' needs.
First Union Capital Markets Corp., the investment banking subsidiary of First Union Corp., provides a full range of investment banking products and services, including asset-backed finance, public finance, syndicated loans, merger and acquisition advisory, private finance, equity underwriting and investment grade and high-yield debt finance.
First Union has grown its capital markets business substantially over the last three years. First Union's Capital Markets Group reported 1997 fee income through Sept. 30 of $531 million, up from $464 million for the full year of 1996 and $265 million in 1995.
Charlotte-based First Union Corp. is the nation's sixth-largest bank holding company with assets of $144 billion as of Sept. 30, 1997. The company serves more than 12 million customers throughout the East Coast and nation.
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