Mr Cooper Group Inc (COOP)

[CBA09]

Ref:
Do you agree or not agree that WMI (the parent) relinquished ownership of WMB when WMB was seized? The only ownership WMI had in WMB was in the stock of WMB that was abandoned (*worthless stock abandonment") which created the NOL).

Comment:
Trustee abandoned and thereby no longer an asset of the estate. IRS Revenue Code 165 G-3 allowed the capital loss to be classified as an ordinary loss (NOL).

Ref:
From that point on WMI had no control of WMB or WMB subs whatsoever as WMB was sold to JPM as a "Whole Bank Purchase".

Comment:
Whole Bank as in assets - $ 298 Billion vs liabilities 258 Billion.

Ref:
Your comment regarding WMI has control of safe harbor assets.

Do you agree or not agree that Safe Harbor Assets are the actual assets within the various trusts that are protected for the benefit of the actual investors (certificate holders) within each trust?

Comment:
Safe Harbor Assets are those assets that have statutory exemption from the bankruptcy systems. Securitization qualifies for such exemption.

Ref:
Do you agree on not agree that payment (proceeds) for assets sold into the trusts has already been received and the only future benefit (besides servicing fees) relating to these trusts would be the retained interest in the trusts and are recorded as an asset on the balance sheet?

Comment:
Proceeds:

1) $ for the initial transfer of pooled mortgages.
True Sale -
Balance Sheet - Remove assets loan mortgages
Income Stmt - Difference between proceeds received (cash) minus loan mortgages transferred = Net Gain or Net Loss.


2) $ Retained Interest.
Balance Sheet - Residual Interest Receivable (Estimated future benefits)
Income Stmt - Income from Residual Interest

Note: Lions share of the Residual Interest (Retained Assets) remain with SPE # 1 - as a Safe Harbor Asset.

Ref:
On a consolidated basis in each 10Q & 10K the retained interests have been listed (I have gone back as far as 2004) and the total retained interests (not credit card related) were as follows:

in billions

MBS:

2004 - 1.62
2005 - 2.80
2006 - 1.90
2007 - 1.71
2008 - 1.23

Comment:
This reflects only a small % of the overall Residual Interest. Lions share protected within SPE #1 - Based on my experience.

Ref:
It's been said that there was a minimum 25% participation in these trusts which IMO is not the case and the only benefit going forward from 2008 was the retained interests.

Comment:
My experience from 1978 - 2004 - No Regulated Minimum. But, Certificates are issued for the Residual Interest and held by SPE # 1 ( Largest % ) and Originator ( there retained % much smaller ).