State investment board forms unique partnership with mortgage firm
Montana State Roundup
Published October 1, 1991 | October 1991 issue
America's Lending Network Inc. (ALN), a subsidiary of Standard Federal Savings Bank of Gaithersburg, Md., will establish a regional 18-state headquarters in Montana.
ALN, one of the nation's largest mortgage-servicing companies, manages more than 600,000 loans nationwide worth nearly $30 billion. Plans call for 200,000 of those to be serviced from Montana.
Company officials say they selected the state for its good air transportation, telecommunications capabilities, quality of the workforce and a $25 million investment from the state's Board of Investments.
The Board of Investments' decision to use $25 million of state pension and other funds to establish a partnership with ALN is a first for a government unit, according to Rick Jones, business recruitment officer for the Montana Department of Commerce.
As a minority partner in a newly created entity, America's Servicing Investment (ASI), the Investment Board will provide the capital to buy servicing rights on mortgages, while ASI will do the actual servicing. Jones explains that, with recent increased capital requirements issued by the Office of Thrift Supervision, savings and loan associations are eagerly seeking such partnerships. For the state, Jones says, this is a first step in competitiveness in back-office industry. About $5 million a year will be injected over the next five years to acquire servicing rights, Jones adds. And in return the Investment Board will receive 99 percent of the partnership's net income, Jones says.
When ALN opens in the first quarter of 1992, the company will employ about 75 people, but that number is expected to grow to 250 within five years. Several communities are under consideration for the headquarters location, which likely will be selected by the end of September.
"The key is that it's a good investment opportunity for the state," Jones says. "It's a happy coincidence to accomplish this goal and create jobs in Montana."