Subprime mortgage securitizer C-BASS files for bankruptcy

Credit-Based Asset Servicing and Securitization, C-BASS, which purchased and serviced subprime and Alt-A mortgage loans, filed for Chapter 11 bankruptcy protection last week. C-BASS, which reported $1 billion in debt in the filing, is owned through a joint-venture of mortgage insurers MGIC Investment Corp. (MTG) and Radian Group (RDN). The company started with a $50 million initial investment in 1996. When subprime began to deteriorate, reaching a delinquency rate 40% in September, C-BASS began liquidating ownership, including selling Litton Loan Servicing to Goldman Sachs (GS) in 2007. It currently is liquidating its existing portfolio and returning the proceeds to its investors, according to C-BASS. Write to Jon Prior.