Banc One Capital Holdings and Orix USA Complete Joint Venture
Meuse said, "Together, ORIX and Banc One Capital Holdings have the capability to create a great commercial mortgage business. It is a great partnership between great partners. This new venture will lead to many other profitable partnerships between our firms."
Akira Seko, President and Chief Executive Officer of ORIX USA Corporation, said, "This is an exciting opportunity to expand our specialized finance capabilities in the United States and internationally in the future. ORIX Corporation has a long history of successful joint ventures in many parts of the world. We look forward to the relationship with Banc One." Seko will serve on the Board of Banc One Mortgage Capital Markets.
Banc One Mortgage Capital Markets will include Banc One Commercial Loan Origination Corporation, Banc One Management and Consulting Corporation, and elements of ORIX USA Corporation's Mortgage Capital Markets Group. The strategic joint venture creates a new entity which will have commercial mortgage loan origination, servicing and special servicing expertise, and a considerable appetite for purchasing CMBS subordinates, distressed real estate assets, commercial mortgage servicing and commercial mortgage loan portfolios.
ORIX USA Corporation, a New York-based financial services company, is a subsidiary of ORIX Corporation, a diversified Japanese finance company with $45 billion in assets. ORIX USA has been an active purchaser of CMBS subordinates over the past three years, and currently holds a portfolio of approximately $150 million of such securities. In addition to CMBS subordinate investments, ORIX USA's Mortgage Capital Markets unit has expertise in financing portfolios of distressed assets and investing in single-family CMO residuals. Among its other businesses, ORIX USA Corporation operates five commercial mortgage loan origination offices (New York, Atlanta, Chicago, San Francisco and Los Angeles) through which it originates loans for its own portfolio. ORIX Real Estate Equities, a Chicago-based wholly-owned subsidiary, also engages in commercial real estate equity investment, development and property and asset management.
Banc One Management and Consulting Corporation is a rated Master and Special Servicer which, at the end of last year, had a servicing portfolio of 6,110 loans and foreclosed properties totaling $4.9 billion. In 1996, Banc One Management and Consulting Corporation won Master Servicing Contracts on three transactions totaling $1.9 billion (placing it 6th among Master Servicers) and it also was awarded Special Servicing Contracts on another $1.3 billion (ranking it 4th among Special Servicers).
Banc One Commercial Loan Origination Corporation is a loan originator that sells loans to conduits operated by various Wall Street dealers, as well as to other third party purchasers. Since Banc One Commercial Loan Origination Corporation's creation in 1995, it has closed approximately $520 million in commercial mortgage loans. Banc One Commercial Loan Origination Corporation is headquartered in Houston, Texas but originates commercial mortgage loans nationwide through its network of branch offices and correspondents.
Initially, Banc One Mortgage Capital Markets will continue to sell loans to third-party purchasers. However, as its business grows, the firm will be well positioned to retain the ownership of originated loans until they are securitized. The special abilities that Banc One Management and Consulting Corporation brings to the venture, namely the servicing of performing and non- performing loans, ensures that expertise is available to manage collateral and deal with troubled loans which is of particular importance to investors in CMBS subordinates such as ORIX USA. As part of the joint venture transaction, Banc One Management and Consulting Corporation's existing servicer ratings from Standard & Poor's ("Strong" Special Servicer; "Above Average" Commercial Mortgage Servicer; and "Average" Master Servicer) and Fitch Investors Service ("Superior" Special Servicer; and "Acceptable" Master Servicer) will apply to Banc One Mortgage Capital Markets.
Banc One Mortgage Capital Markets will be a fully integrated commercial mortgage lender that will complement Banc One's other mortgage and investment banking operations nationwide as well as the domestic and global real estate lending and investment activities of ORIX. Banc One will retain a 55% interest in the joint venture entity, while ORIX USA has purchased the remaining 45%. Banc One Mortgage Capital Markets' business plan for the remainder of 1997 calls for the deployment of $100 million in capital in real estate related investments, adding $1 billion in new servicing contracts and growing commercial mortgage originations to a $1 billion annual pace.
ORIX USA Corporation is a broadly diversified financial services company with activities ranging from asset-based loans and equipment leases to general corporate finance and real estate financing. ORIX USA Corporation is a subsidiary of ORIX Corporation of Tokyo, Japan, a publicly owned financial services company with operations in over 25 countries worldwide and assets of $45 billion.
BANC ONE CORPORATION (NYSE:ONE) had assets of $101.6 billion and common equity of $8.2 billion at March 31, 1997. BANC ONE now operates 1,502 offices in Arizona, Colorado, Illinois, Indiana, Kentucky, Louisiana, Ohio, Oklahoma, Texas, Utah, West Virginia and Wisconsin. BANC ONE also owns several additional corporations that engage in credit card and merchant processing, consumer finance, mortgage banking, insurance, venture capital, investment and merchant banking, trust, brokerage, investment management, equipment leasing and data processing.
Information about BANC ONE's financial results and its products and services can be accessed on the Internet at: http://www.bankone.com and through InvestQuest(TM) at http://www.investquest.com or Fax-on-demand: 614-844-3860.