A large servicing investor has set up an asset management division for insurers, which have shown more interest in residential mortgage-related investments as they’ve pulled back from the commercial sector.
Bayview Asset Management formally announced the establishment of the dedicated unit for insurers on Monday. Chief Investment Officer Nancy Mueller Handal, the former head of private fixed income and alternatives at MetLife, will oversee the division.
“There is a clear demand from insurance companies for a broader, diversifying set of investment opportunities,” she said in a press release.
Bayview has experience managing a large number of mortgage-related assets at scale, including more than $620 billion in owned servicing. It has also purchased $163 billion in mortgages and originated $123 billion in home loans since inception.
In addition, Bayview has been a provider of credit protection for U.S. banks and government sponsored enterprises. It has executed transactions that represent more than $400 billion in credit risk transfer for domestic financial institutions and GSEs.
Mueller Handal previously worked with Bayview while building MetLife’s residential whole loan portfolio, for which she helped source $40 billion in mortgages. That total included more than $11 billion in loans from Bayview.
She also helped manage MetLife’s mortgage investments in the aftermath of the Great Recession, when widespread underperformance led to the need to modify large numbers of loans, giving her experience dealing with assets in a stressed environment.
MetLife at one point during that period was a mortgage lender and servicer but later decided to withdraw from those business lines.
