H&R Block’s Mortgage Unit Loses Credit Line

  • 06 Jul 2007
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H&R Block said the subprime mortgage unit it is selling has lost a credit line, lowering its borrowing capacity closer to the minimum needed for the sale to go through, reports Reuters. In a filing with the Securities and Exchange Commission, the company said Lehman Brothers did not renew a “warehouse” facility with the subprime unit, Option One Mortgage, after it expired June 28. The facility provided at least $1 billion of borrowing capacity, according to Reuters.

Cerberus Capital Management, the private equity firm that agreed in April to buy Option One, required the unit to maintain at least $8 billion of warehouse capacity through the closing date, expected in October. Separately, Bank of America agreed to boost its ware house credit facility to $2.25 billion from $2 billion until the sale of Option One is completed.

Click here to read the article from Reuters

  • 06 Jul 2007

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1 Bank of America Merrill Lynch (BAML) 4,755 19 11.75
2 Citi 4,288 14 10.60
3 Rabobank 2,633 4 6.51
4 Goldman Sachs 2,615 4 6.46
5 Barclays 2,603 8 6.43

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3 Wells Fargo Securities 48,214.86 152 10.28%
4 JPMorgan 33,301.70 114 7.10%
5 Credit Suisse 25,010.27 80 5.33%