The Goldman Sachs Group Inc backed mortgage insuere Essent Group Ltd, together with George Soros, had added Wells Fargo & Co to its group of underwriters for an IPO. Wells Fargo is the largest customer of Essent.
Wells Fargo is currently the largest home lender in the United States. It had accounted for 17% of Essent's overall sales in the first half of 2013. The information was based on the documents filed by the insurer which is based out of the Bermuda. Another underwriter included in the IPO is the third largest mortgage offeror, Bank of America Corp.
Mortgage insurance covers losses when debtors default and foreclosure does not fully pay off the debt. This is often chosen by originators or original mortgagors. Essent was established at the height of the 2008 financial crisis, as record homeowner defaults caused many players to move away from the business. As the housing market recovers, the companies that did survive are now seeking ways to attract investors who want to cash in on the market growth and development.
Wells Fargo is the only financial institution accounting for more than 10% of the revenue of Essent, according to the documents filed. Othe financial institutions on board include Goldman Sachs, JPMorgan Chase & Co and Barclays Plc.
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