Not Everyone at APM is Feeling the Synergy

On Friday, The Mortgage Scoop broke the news that American Pacific Mortgage had closed on the acquisition of Synergy One, creating a roughly $14B lender.

Together, APM & Synergy One gain a broader product mix, wider distribution, a more sophisticated capital markets platform & opportunities to eliminate overlapping costs. Just as importantly, Synergy One appears poised to maintain more independence than it would have under other buyers. (Several industry execs told me their inquiries w/ Steve Majerus to buy S1 went nowhere.)

But in mortgage banking, one man’s synergy is another man’s turf war. Take Phil Lekousis, president of Preferred Rate, APM’s biggest division. Shortly after the deal was announced, Lekousis left a rather spicy comment on my LinkedIn post suggesting the acquisition didn't make quite as much sense as some observers believed.

Lekousis later deleted his comment 😞 & neither he nor APM leadership responded to my inqueries. 

Still, the deleted comment highlights an often-overlooked reality of mortgage M&A: acquisitions can be disruptive not only for the company being acquired, but also for the buyer. Synergy One operates in Preferred Rate's backyard, & Lekousis — known for shooting from the hip — appears less than thrilled by the prospect of sharing turf. Whether the comment reflected genuine frustration, a negotiating tactic or both, it’s a reminder that M&A can create v messy internal politics.

"I'm surprised he hasn't gone IMB himself, but no doubt he's weighing his options," said one mortgage executive familiar w/ Lekousis. "His team was really happy at APM before this. My guess is he stays for now, but there is much love lost."

Preferred Rate probably could go IMB (it has a cap markets team & experienced leadership), but there are the aforementioned advantages to being a DBA of a larger shop (low scrape but plentiful resources). For Lekousis, there’s also an element of deja vu. Back in the day, he was an SVP at Peoples Home Equity & was kept in the dark when it was sold to Cardinal Financial, sources said. He was passed up for a key role & then left.

It's still unclear how many Synergy One branches will sign new employment agreements & join as a division of APM, but retaining sales talent these days isn’t cheap. Competitors are already calling branches, hoping to capitalize on uncertainty.

In some recent M&A deals involving big players, acquirers handed out between 40 & 100(!) bps on trailing 12 months of production to retain branches, sources said. It’s not APM’s style to throw out crazy retention bonuses like the very big boys, but acquiring a $4B originator as an ESOP will require real capital. (APM is a 49% ESOP; Synergy One also had a number of investors beyond Steve Majerus & Aaron Nemec, including employees).

“Mergers just don’t work today unless big dollars are put on table for retention, which in turn affects rates & the balance sheet of the company,” said one rival industry exec.

Another industry source added: In asset deals, “a decent chunk of that upfront cash that's being paid to the seller is expected to go to retention for key people, usually the most influential, outspoken branch managers.”

And by the looks of it, APM might need to find some extra cash to keep Lekousis & his team happy…

In Wednesday’s edition for paid subscribers, I’ll share more reporting on the M&A landscape & details on the advantages/disadvantages to ESOP deals.

CCM has agreed to waive the non-solicitation provisions of its merger agreement w/ Two Harbors until Friday, which opens the door for UWM to engage in discussions. Buuuuut it’s an ultimatum for UWM — the wholesaler has to bid all-cash, the REIT’s board said Monday morning. The vote was delayed again until June 23. I hope you don’t mind, but I took the liberty of asking ChatGPT to write a UWM-CCM-TWO-styled version of the Wu-Tang Clan’s classic, “C.R.E.A.M.” to celebrate the moment. 

I grew up in the mortgage game, rates was high
Watchin' lenders chase volume while the margins died
Every conference, same story, same disguise
Everybody talkin' growth while the gain-on-sale cried

Then I heard the rumor through the servicing grapevine
UWM stackin' assets, thinkin' way beyond prime
Two Harbors in the background countin' every dime
While the brokers kept submittin', never read the fine line

CCM in the middle, caught up in the storm
Tryna keep the engines runnin', keep the platform warm
Then the headlines hit hard, whole industry alarmed
Everybody in the comments section suddenly informed

Analysts speculate, X users investigate
LinkedIn experts appear, twenty years too late
Capital markets cats tryna calculate
How the servicing chessboard gonna reallocate

(Chorus)

M.S.R. rules everything around me
Servicing, servicing y'all
Collect the fees, y'all

M.S.R. rules everything around me
Servicing, servicing y'all
Watch the deal flow

Weird & part of me hates it b/c it’s AI, but I also have to admit that it’s pretty decent.

President Trump said he wants Bill Pulte to begin firing a large number of employees as part of a shake-up of the U.S. intelligence community, the WSJ reported. 

Trump told the WSJ that he had five interviews for the job, & that Pulte would be the acting director for as long as it takes to get a new person confirmed by the Senate. Trump said that the number of intelligence staffers has “been way too high for way too long, if he cut I wouldn’t mind that.”

Pulte lacks experience in intelligence, but he certainly does know how to reduce a workforce. Over 100 staffers at Fannie Mae were fired last year after the Pulte-controlled GSE accused them of allegedly engaging in unethical conduct. There have been additional rolling RIFs at the agencies & many FHFA staffers have also exited.

Trump also told reporters that a GSE IPO is still in the cards but he’s in no rush…

Agency mortgage-backed security (“MBS”) new issuance in Q1'26 was $331 billion, a 5.9% decrease from $352 billion in Q4'25.

The market share of correspondent lending decreased to 35.8% in Q1'26, compared with 36.3% in Q4'25. The five largest correspondent lenders issued $68.4 billion (compared to $75.9 billion in Q4'25), including Pennymac with 19.7% correspondent market share, UWM with 13.9%, AmeriHome with 10.4%, Rocket Mortgage with 7.1%, and NewRez with 6.6%.

Freedom (2.5% to 3.3%) and Rocket (6.4% to 7.1%) had the largest correspondent channel market share increases in the quarter, while NewRez (7.8% to 6.6%) and Ocwen (5.2% to 4.1%) had the largest market share decreases.

The market share of third-party originated (“TPO”) loans decreased to 16.0% in Q1'26, compared with 16.7% in Q4'25. The five largest TPO lenders issued $38.3 billion (compared to $44.9 billion in Q4'25), including UWM with 43.7% TPO market share, Rocket with 13.9%, Pennymac with 6.0%, NewRez with 5.1%, and The Loan Store with 3.3%.

Union Home Mortgage (2.0% to 3.1%) and Pennymac (5.3% to 6.0%) increased their TPO market share in the quarter, while UWM (47.8% to 43.7%) and NewRez (6.3% to 5.1%) had the largest market share decreases.

The market share of retail loans rose to 48.2% in Q1'26, compared with 46.7% in Q4'25. The five largest retail lenders issued $51.9 billion (compared to $50.7 billion in Q4'25), including Rocket with 12.4% retail market share, CrossCountry with 5.7%, Freedom with 5.4%, Lakeview/Guild with 5.3%, and Rate with 3.7%.

Freedom (3.2% to 5.4%) and Lakeview/Guild (4.3% to 5.3%) increased their retail channel market share in the quarter, while Rocket (14.5% to 12.4%) and Mortgage Research Center/Veterans United (3.2% to 1.7%) had the largest market share decreases. 

The TPO market share of refinance loans decreased to 16.1% in Q1'26 from 18.8% in Q4'25, correspondent share remained stable at 29.2% from 29.1%, and retail share rose to 54.6% from 51.9%. The market share of purchase money loans remained relatively stable across all channels from Q4'25 to Q1'26.

This report is brought to you by Milliman. Milliman provides strategic and quantitative consulting services across the mortgage market with expertise in origination, servicing and capital investment.

Source: Fannie Mae, Freddie Mac, and Ginnie Mae MBS Data Disclosure