ICE borrows $6.5 billion to expand its mortgage industry footprint

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That’s more than half the $11 billion that ICE agreed to pay for cloud-based mortgage platform provider Ellie Mae earlier this month.

Intercontinental Exchange Inc., the owner of the New York Stock Exchange, borrowed $6.5 billion on Monday in the corporate bond market to help expand its footprint in the U.S. mortgage industry.

The 2007-’08 global financial crisis exposed major weaknesses in the mortgage underwriting and servicing industries, which resulted in states’ attorneys general, including Kamala Harris, Joe Biden’s pick as vice president, extracting $25 billion in foreclosure fines from major U.S. lenders.While Ellie Mae doesn’t make mortgage loans itself, it is among a number of platforms looking to bring more of the estimated $11.2 trillion residential-mortgage finance market into the digital era.

Specifically, the longest, a 40-year parcel of ICE bonds, cleared the market at a spread of 160 basis points above a risk-free benchmark to yield 3.04%, according to a person with direct knowledge of the dealings.

 

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