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Ross: MBS Problems Still Ahead

Thursday, October 07, 2010 - 05:42

Billionaire investor Wilbur Ross is focusing on commercial real estate, the healthcare sector and European banking, saying the effects of the financial crisis are not over yet.

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companies and turning them around. He now sees opportunities in US and overseas banking mortgages and other areas he joins me now it's very good to see once again this is. You're asked -- our Reuters summit what areas geographically intrigues you the most portrait distressed investing . You said Europe is going to be in for a rough time what are you seeing opportunities specifically in Europe well. stories situations. Pacific. But in general the easier deals with more attractive deals are probably about. Ross thank you so much good to see once again. I Rhonda schaffler . This is writers. Billionaire investor Wilbur Ross has made a personal fortune investing in distressed companies and turning them around. He now sees opportunities in US and overseas banking mortgages and other areas he joins me now it's very good to see once again this is. You're asked -- our Reuters summit what areas geographically intrigues you the most portrait distressed investing . You said Europe is going to be in for a rough time what are you seeing opportunities specifically in Europe well. And our case we're focusing very much and Ireland and and you okay. Both of which is a big big banking crisis government indices. Number thanks and -- in the case of Ireland they've been dealing very decisively. With the proud. So we think the turnaround there. While it's very painful. Will be relatively quick. And within the financial sector in Europe you see this beyond the UK and Ireland as well terms bottles -- do. Because of the sovereign debt crisis and the -- schools contingencies. That is developing many of the other countries. In the US you've invested over the summer in New Jersey sun Bancorp you also. But the failed bank united of Florida how would you describe the opportunities right now in the US financial sector. Well there remain opportunities. They're more strategic buyers. There had been. And so the price things getting a little bit more difficult. So -- stories situations. Pacific. But in general the easier deals with more attractive deals are probably about. That your kids and about the market. Market you are concerned that going forward is going to be even more difficult to get a mortgage which is hard to imagine given how hard. How difficult this right how could get a mortgage. What's going on in net finance industry what's under current that you're seeing is the warnings well. The problem is. As you know a lot of the big -- it's servicing. Operations. Did these -- signatures which. Then that they're putting in affidavits. Where people's said that they had written documents and verified -- and they really had. Well that's. It's nobody can condone. Making out -- false affidavit. Was the problem that's created is now -- to -- and foreclosures. So it's building up these kind of shadow. Foreclosure over -- have houses. And it's yet another reason for lenders to worry if and when I have to foreclose well they're really being able to do it. Are we at risk that the financial. Industry turmoil of the past couple of years is going to repeat itself. Well I don't think it's ever really ended. It's just. Taking a little bit different. For instance to it is residual -- for club there's been problems with the residential mortgage backed securities. We're still probably at the fairly early days. Problems with commercial mortgage backed. Securities so. I was so it's definitely not only -- On the subject of commercial real estate you've been surprised many others have to that we've not seen a rate of foreclosures this year some projected. If things had changed mixture and you see opportunity. Think it probably will change their more and more maturities. Coming and being oil in most cities the fundamentals of the deteriorating. Occupancy rate percentages are going -- rent rates are going down. And meanwhile there is that all of these looming maturities coming. And commercial mortgage backed securities. There over 300 billion maturities each year for the next several. Years ago over three years earlier period due to -- trillion dollars. Of maturities the pullout. Switching topics a little bit -- get to health care -- you you set aside a billion dollars for potential. Investing opportunities in the health care sector data legislation out of Washington. Do you think that's enough. Well I don't know that it's enough to fix the whole country that is that's enough from the point of view of that report. And in terms of health care opportunities early to say but you think it's going to be a wide spectrum or. -- narrow focus new -- with in the industry will help. Terrorists over 60% of the whole economy so we've been of these small subset. Within health care it was a pretty big things. Get us. Interest in action there possibly. We we've we've been surprised again that there have been more. Foreclosures. There. But. We think that's probably starting. This SP hard for you to -- but what's the best. Last year. -- bullet that's a good question. -- would say it's a little over a year but I would say the bankunited to. Field. Because it was very very well executed by John K and us. And his team. Been relatively problem free. From the day that we got in there. So certainly room and anxiety -- you it's it's been the best namely having these things. That's good we don't want to have any Wilbur Ross thank you so much good to see once again. I Rhonda schaffler . This is writers.

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Ross: MBS Problems Still Ahead

Thursday, October 07, 2010 - 05:42