American Business Financial Services, Inc.

Client

MBIA Insurance Corporation, Ambac Assurance Corporation, Financial Security Assurance Inc. (the “Monoline Insurers”)

Challenge

Assist the Monoline Insurers in protecting the securitization pools for which they provided credit enhancement. Assist American Business Financial Services (ABFS) to maintain its portfolio servicing levels during its bankruptcy proceeding. Assist ABFS to sell its servicing business to an alternative servicer acceptable to the Monoline Insurers.

Solution

Mobilize a team, acceptable to ABFS, its senior lender – Greenwich Capital, unsecured bond holders, the US Trustee and the Bankruptcy Court, to monitor and approve all aspects of ABFS daily operations and to ensure that appropriate portfolio servicing policies continued to be implemented.

Results

On behalf of the Monoline Insurers and with the approval of all other constituents, Bridge worked closely with ABFS, its investment banker and the buyers brought to the process, toidentify that buyer with the appropriate servicing record and capitalization to satisfy the Monoline Insurers and gain their approval for a transaction.

ABFS’ primary asset, its loan servicing portfolio, was sold in a Section 363 sale following the identification and selection of a stalking horse bidder and an auction process. Subsequently, Bridge managed the servicing conversion process,working with ABFS and its financial advisors to develop a comprehensive servicing transition plan. The sale transition closed with the successful buyer, OCWEN, within a month after the auction.