Citi Soon to Be 6th Largest.(Citigroup Inc.)(Brief Article)

Five years ago, all sorts of rumors were flying around the industry about how Citigroup (then called Citicorp) was about to bolt from the residential finance sector.

But that was before Citicorp merged with Travelers, and then went out and bought subprime giant Associates First Capital Corp. of Irving, Texas.

Yes, it would appear that under chairman and chief executive Sandy Weill, Citigroup loves mortgages.

As Mortgage Servicing News went to press this month, Citigroup was on the verge of closing on its purchase of Golden State Bancorp, San Francisco, the parent of First Nationwide Mortgage Corp., Frederick, Md., the nation's ninth largest servicer of residential loans.

Once Citigroup integrates FNMC into its own CitiMortgage, the combined entity will rank sixth among all residential servicers with $226.47 billion in housing-related receivables and a market share of 3.84%. (It also will rank sixth among residential producers.)

Whether Citigroup will gobble up any more firms among the top 20 (FNMC ranked ninth among servicers and 18th among funders) remains to be seen.

With the exception of Washington Mutual, Seattle, the mortgage M&A market has been somewhat slow the past year because servicing runoff has made it difficult to value and sell companies. And even WaMu has cooled its M&A heels of ...