Bear Stearns Launches Residential Mortgage Company

Business Wire, April 18, 2005

NEW YORK -- The Bear Stearns Companies Inc. today announced the launch of Bear Stearns Residential Mortgage Corporation, which will provide mortgage brokers with an easy, streamlined solution for financing home mortgage loans. The initiative is an extension of Bear Stearns' strategy to continue to enhance and diversify its industry-leading mortgage platform.

"The addition of a wholesale unit complements our presence as the largest underwriter of mortgage-backed securities," said Warren Spector, President and Co-Chief Operating Officer of Bear Stearns. "The business allows us to round out our mortgage franchise and provides us with an additional way to serve our clients. By employing the latest technology, we are enabling brokers to come directly to Wall Street for financing."

BearDirect.net, the company's web interface, enables brokers to receive immediate feedback on mortgage loan product and pricing scenarios. Brokers can then electronically submit loan applications for approval by an automated underwriting engine and lock in loans online. This tool will enable brokers to better support homeowners and will minimize the time between funding and closing of loans.

"The launch of Bear Stearns Residential allows Bear Stearns to further vertically integrate our mortgage platform," said Tom Marano, global head of mortgage-backed and asset-backed securities at Bear Stearns. "Coupled with our recent investment in Essex & Capital, a United Kingdom residential 'packager,' Bear Stearns has continued to develop dedicated sources of mortgage loan production."

The new company enables Bear Stearns to better serve the needs of mortgage originators. As mortgage brokers obtain warehouse lines and become mortgage bankers, Bear Stearns Residential provides underwriting capability prior to funding which permits newer mortgage bankers to mitigate the risks of closing loans in their own name. Established mortgage bankers may elect to broker certain new products through Bear Stearns Residential to help them mitigate the risks of their new product offerings

"Account executives still pull over to the side of the road to calculate the pricing of loans for brokers," said Jeff Walton, CEO of Bear Stearns Residential. "What we have created is a fully automated system that allows brokers to run what-if scenarios, check on the status of loans, get immediate online approval, lock in loans and minimize paperwork."

For over 20 years, Bear Stearns has been one of the largest purchasers of residential mortgages for the purpose of securitizing them into investment pools. Bear Stearns Residential will focus on non-conforming loans which are included in the private label MBS market. The company is based in Scottsdale, Ariz. and has an East Coast operations center in Philadelphia.

Founded in 1923, The Bear Stearns Companies Inc. is the parent company of Bear, Stearns & Co. Inc., a leading investment banking and securities trading and brokerage firm serving governments, corporations, institutions and individuals worldwide. With approximately $48.5 billion in total capital, the company's business includes corporate finance and mergers and acquisitions, institutional equities and fixed income sales and trading, securities research, private client services, derivatives, foreign exchange and futures sales and trading, asset management and custody services. Through Bear, Stearns Securities Corp., it offers prime broker and broker-dealer clearing services, including clearing and securities lending. Headquartered in New York City, the company has approximately 11,000 employees worldwide. For additional information about Bear Stearns, please visit our website at http://www.bearstearns.com.