Citi Buys Bulk MSRs.(Citigroup purchases mortgage banks)

Washington -- Citigroup has agreed to purchase $19 billion in residential servicing rights from Waterfield Mortgage, Ft. Wayne, Ind., investment banking officials told Mortgage Servicing News.

The sale is part of Waterfield's plan to exit the residential business, a strategy that also may involve the sale of its thrift affiliate, Union Federal Bank of Indianapolis.

At press time, CitiMortgage chief Bill Beckmann could not be reached for comment. A subsidiary of Citigroup, CitiMortgage ranks fifth among all residential servicers in the U.S. with $386 billion in housing receivables. (The rankings represent assets at the end of the third quarter.)

A spokeswoman for Waterfield declined to identify the buyer of its servicing portfolio. Phoenix Capital of Denver is believed to be the broker on the deal.

By purchasing the servicing rights CitiMortgage will not move up in the rankings. The number four ranked servicer is Chase Home Finance, Iselin, N.J., with $587 billion in receivables.

However, CitiMortgage has been one of the more acquisition-minded mortgage firms the past few years, buying such franchises as Principal Residential and Golden State Bancorp.

About 10 days ago American Home Mortgage, Melville, N.Y., said it had agreed to purchase Waterfield's production operation, which includes retail, wholesale, and ...