06/04/2010

UBS Nabs Mulford for Mortgage-Bond Role

Ken Mulford, best known for his role in securitizing subprime mortgages at the now-defunct Ameriquest, arrived at UBS this week - the latest sign of the bank's ambitions to rebuild its once-active securitization-banking business in the U.S.

Mulford started June 1 as a managing director reporting to Frank Byrne, the former Deutsche Bank securitization chief who is leading efforts to re-establish UBS' presence as an underwriter and issuer of structured products Officially, Mulford fills a vacancy created when executive director Patrick Fitzsimonds left the bank to join Goldman Sachs. But market players said there will be a new aspect to his role: helping to resurrect UBS' dormant mortgage-financing business.

Within the next 6-12 months, UBS wants to ramp up originations of U.S. home loans with an eye toward selling or securitizing the credits. That's where Mulford comes in. From 2003 to 2007, he led Ameriquest's loan-disposition group, which routinely securitized subprime mortgages and home-equity credits or sold them as whole loans - often to buyers that packaged them into their own securitizations.

Mulford also could play a role drumming up underwriting business from mortgage lenders, a craft he practiced at Citigroup before joining Ameriquest. He is stationed in UBS' Stamford, Conn., office.

Mulford has held structured-product positions at a number of companies, including a stint at Merrill Lynch. He then moved to ACA Financial, where he briefly led a team that bought asset-backed securities and mortgage bonds for use in collateralized debt obligations. Next came Citi, and then Ameriquest. During his time there, the Orange, Calif., company sold $139.7 billion of mortgage-related bonds via 127 deals, according to Asset-Backed Alert's ABS Database.

Mulford's exit from Ameriquest came shortly before the lender collapsed along with most of the rest of the subprime-mortgage industry. He then took a senior position in J.P. Morgan's mortgage-finance group in New York. It's unclear when he left.

Word of Mulford's move to UBS is causing a stir among veterans of the subprime-mortgage market, who said the hire underscores the bank's ambition to re-establish itself as an issuer and underwriter of home-loan deals. UBS withdrew from the mortgage-securitization sector in 2008, ending an eight-year run in which it ran the books on 505 deals with a combined face value of $292.3 billion, according to the ABS Database.

During the same period, it issued $120.8 billion of mortgage securities via 202 transactions.

Mulford is the latest in a series of high-profile securitization professionals UBS has hired since Byrne arrived in September. This month, the bank is expected to add several senior salespeople and analysts in Chicago, San Francisco and Stamford. Next month, former Deutsche student-loan executives Jim Murphy and Paul Vambutas will join (see article on Page 3).

Just this week, UBS ran the books on a timeshare-loan securitization issued by Silverleaf Resorts of Dallas (see Initial Pricings on Page 5).

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