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Douglas Rossbach

Mr. Douglas Rossbach

Partner, Rossbach Consulting

What is a GLG Leader?|GLG Leaders are a separate tier of Council Members with a Council Rank in the top 5%. These GLG Member Program participants are eligible for ongoing, in-depth consultative relationships with GLG clients.

Member of the Insurance Council

Council Member Biography

Douglas Rossbach is Founding Partner of Rossbach Consulting, which advises investment companies, insurers and participants of the residential mortgage industry. He is also CEO of Hillhouse S.A., a real estate holding company. Prior to founding Rossbach Consulting, Mr. Rossbach held several positions at Radian Guaranty, including SVP of Int'l Strategic Initiatives and SVP of Strategic Planning and e-Commerce. At Radian, he identified and evaluated worldwide diversification acquisition and JV opportunities. He also developed and launched a new strategic plan, resulting in the reorganization of the company. Before Radian, Mr. Rossbach was an SVP at Wells Fargo Home Mortgage where he ran the direct-to-consumer origination channel and directed the Marketing Services Group. Prior to Wells, Mr. Rossbach was a consultant with McKinsey and Co. where he directed studies for leading global financial institutions. Prior to McKinsey, Mr. Rossbach managed a group of retail branches for Citibank. (This is me - Update Profile)


Employment History

2008 - Unspecified
Partner, Rossbach Consulting
2007 - Unspecified
Chief Executive Officer and Principal, Hillhouse SA
2000 - 2007
Senior Vice President, RADIAN GUARANTY INC.
1989 - 2000
Senior Vice President, WELLS FARGO HOME MORTGAGE INC
1985 - 1989
Engagement Mangaer, Mckinsey
1984 - 1989
Vice President, SOUTHEAST BANK & TRUST

GLG NewsSM Analyses by Douglas Rossbach(?)

Opinions and analyses expressed in GLG News are solely those of the author. See the Terms of Use for details.

A Better Way To Stop Foreclosures

March 10, 2009

Obama's Housing Plan | topics.nytimes.com

Most economists agree that we are now in a vicious cycle of defaults>foreclosures>dropping house prices>economic recession>rising unemployment> more defaults, etc. While the recently approved stimulus package and TARP funds may reduce the likelihood of a complete meltdown of our financial markets, these actions do not address one of the root causes of the credit crises, namely mortgage defaults and the resulting foreclosures. The Obama administration recognizes the importance of interrupting this vicious cycle, and their proposal to use government funds to encourage loan modifications is a step in the right direction. Unfortunately the results of earlier loan modification programs have been awful, with approximately 60% of the loans re-defaulting; and it appears that the administration’s new initiatives, bundled under the Homeowner Affordability and Stabilization Act, are poorly structured and may suffer a similar fate.

There is a fair solution to the housing crisis without government bailouts

October 30, 2008

Why the Feds Rescue Banks, Not Homeowners | www.usnews.com

There is growing momentum in Washington (that is now being whipped into a frenzy by the upcoming elections) to help struggling homeowners directly by buying and or modifying their mortgages.  The government has so far failed to do this, preferring instead to pump capital and liquidity into the banking system.  The government's reluctance to get involved with homeowners is understandable.  The problem is massive and messy.  Five million loans are headed for foreclosure, many of these loans are sitting in securitizations and it is difficult to determine who controls them, and the government does not want to incur the moral hazard of helping or encouraging irresponsible behavior on the part of borrowers or lenders.

Mortgage Insurance .. Helped Today, Gone Tomorrow?

October 10, 2008

Rescue Sunday | online.wsj.com

The mortgage insurance industry would appear to benefit from the latest government actions to inject liquidity into the credit markets and reduce foreclosures.  After all, anything that will stem the drop in housing prices and prop up the economy should reduce mortgage defaults and mortgage insurance claims.  Moreover the industry should benefit from more cautious underwriting and improved pricing.  Assuming the mortgage insurers survive the current credit crisis, things should be rosy right?  Wrong. It is unclear what value the mortgage insurers bring to the emerging mortgage market now that Fannie and Freddie are government owned and the industry is moving toward plain vanilla, prime product.  In this future, credit risks are well understood and easily priced.  Fannie and Freddie no longer need a downgraded counterparty to share the risk, and the banks which will control most new lending will want to hold on to all the profit margins that they can.

Private Mortgage Insurance Companies Running Out of Options

June 27, 2008

Moody's Lowers Its Ratings on Radian and Two Units | online.wsj.com

The mortgage  insurance industry has suffered horrific losses and is quickly losing ground in a struggle for survival. Triad announced that it will cease insuring new loans.  The three major mortgage insurers (MTG, PMI, RDN) have been downgraded below AA, the minimum rating required by the GSEs (Fannie Mae and Freddie Mac).  The GSEs are allowing the MI's to continue insuring their loans, based on plans submitted by each company detailing how they will restore a AA rating.  These plans are becoming harder to execute. Despite holding over $18 billion in cash and investments(including reserves), market capitalization for the three companies has fallen from $15 billion one year ago to $1.2 billion today.  It is next to impossible for  the MI companies to raise significant new equity at these prices.  Long term debt has also become very expensive. Credit default swaps on Radian debt are now priced at junk bond levels.

Rating Agencies Drive Mortgage Insurer's Quest for Capital

June 12, 2008

Fitch Cuts Mtge Insurer Ratings; Sees Pressure Until Late '09 | online.wsj.com

Recently Fitch, S&P and Moodys all lowered the ratings of the major mortgage insurance companies (MTG, RDN, PMI). The rating agencies justified these downgrades based on challenges and the high losses the MI industry is incurring as a result of the meltdown in the mortgage market. To manage this risk, the MI companies have set aside huge reserves to cover the expected losses and have also dramatically changed pricing and underwriting standards.  Moreover, most of the MI Companies continue to have more than enough statutory capital to justify much higher credit ratings.  Despite all these efforts, the rating agencies continue to hint of further downgrades and have several companies (Radian and MGIC) on negative watch.

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