Murrayhill Expands Business Model to Touch Whole Deals.

The Murrayhill Co., Denver, made a name for itself by helping investors manage risk on the bottom pieces of mortgage-backed securities transactions.

Now, the company has expanded its niche by offering its services to Wall Street securities firms when they issue a mortgage-backed bond. These bonds are typically bought by large investors such as insurance companies and pension funds.

As a result, Murrayhill is hired by the company that issues a bond as a party to the entire security - not just the riskiest tranches.

Since investors are more risk conscious in a slow economy, Murrayhill believes its business model is somewhat countercyclical.

The change has fueled growth for Murrayhill, which employed eight people as recently as two years ago. Today, the firm has 50 employees.

Murrayhill's primary job is to monitor the servicer of the loans, with particular attention to managing the loans that go into default. Murrayhill then gives the investor information to help the investor analyze the performance of the bonds and of the servicer.

The company's role is to fill an information gap between the servicer, who has no financial risk in the outcome of a foreclosure or loan default, and the investor, who bears the risk.