Flagstar Bancorp Inc., the holding company for Flagstar Bank FSB, announced that it has entered into an agreement with the U.S. Department of Justice (DOJ) relating to underwriting practices associated with loans insured by the Federal Housing Administration (FHA) of the U.S. Department of Housing & Urban Development (HUD). As a result of the agreement, Flagstar will be revising its Q4 and full year 2011 financial results.
"Flagstar Bank is one of the leading originators and servicers of FHA insured loans, and we remain committed to continuing in that capacity," said Joseph P. Campanelli, chairman of the board, and president/chief executive officer of Flagstar. "This agreement with the Department of Justice allows us to move forward, and to continue to focus on core operations and on serving our customers."
"As our recent results demonstrate, our mortgage origination, commercial and retail banking operations continue to perform well, positioning us to achieve profitability in 2012," said Campanelli. Importantly, the default rates on the FHA loans we have underwritten continue to perform favorably relative to the rest of the industry. We are pleased to have resolved this matter and look forward to continuing as a committed partner with FHA and HUD. We look forward to executing on our strategic plan to grow and diversify our business and create value for our shareholders."