Jeff Carbiener PLAY INTERVIEW VIEW BIO www.lpsvcs.com Rick Genoni ETF Product Manager, Vanguard Jim McCluney President and Chief Executive Officer, Emulex Corporation Lanham Napier President & CEO, Rackspace Hosting, Inc.		PRINT-FRIENDLY VERSION Jeff Carbiener President & CEO Lender Processing Services, Inc. Interviewed on 11/24/2008 Provide an overview of Lender Processing Services: What we do is we provide the technology platform, the data and the processing services that mortgage lenders use to run their day-to-day operations. We really focus in on technology, on providing our lenders with their core operating platforms that run their three key functions: origination-based function, their servicing function, and their foreclosure function. And on top of those technology platforms, we layer on services that help them perform the underwriting and servicing and foreclosure activity, such as appraisal services and flood certifications. And those stand-alone services we integrate back into the core technology platform in order to give a nice comprehensive suite of solutions that our lenders can utilize. And it’s that business model and that approach that’s allowed us to penetrate into most of the top lenders in the country. We currently do business with 39 of the top 50 lenders. Better than 50% of the first mortgages in the country process on our platforms located in Jacksonville, Florida. And it’s also about business models. It’s not only allowed us to penetrate customers, but it's allowed us to produce strong financial results in a very volatile market. I mean, we all know that origination and refinance activity is significantly off versus the prior year activity. And through that we’ve been able to consistently grow our revenue base at around 11% and maintain very strong operating margins in the mid-20s. Why did Lender Processing Services spin-off from Fidelity National Information Services? LPS is one of the two primary operating segments within Fidelity National Information Services. And when we looked internally at the Lender Processing business in mid-2007, we saw a couple things. First, we saw that the Lender Processing business was really competing very heavily for capital allocation within the FIS organization and really looking for those investment dollars that it needed to grow. Additionally, when we looked at the Lender business we saw that we were really running it as a separate and distinct business. It had its own management team, its own sales structure, its own operations, its own technology. So we didn’t really see a whole lot of synergies within the Lender businesses and the other businesses within FIS. Now when we looked out to the market side and talked to our investor base, what we did see was that we have a very complex story at FIS – a lot of moving parts. And as a result our investor base felt that really we weren’t getting the value in the marketplace as we would if we really clarified the picture. So our decision in third quarter last year was to spin-off the Lender Processing business; and by doing that spin-off, we would create two stand-alone companies – pure plays that could be managed separately, could make their own capital allocation decisions, could work on simplifying their stories to the market – and therefore unlock the value that we thought was really being withheld from our combined company when we were just total FIS. What are the challenges facing your business? The challenges facing our business are similar to the challenges facing most mortgage lenders: the fact that you see such volatility in the volumes every day. Origination volumes and refinance volumes are up one week and they’re down the next. Foreclosure volumes are escalating. So just managing through that volatility is always a challenge. But that also creates opportunities for us because we provide services that help our lenders manage those volumes as well. I think another challenge in our business is just that we face continued consolidation in the industry – a lot of banks that are consolidating with other financial entities. And when that happens, that creates a situation where we may be providing services for the acquired entity; and then we have to work with the new entity to make sure that we continue to provide seamless service through. So anytime there’s consolidation in the industry it creates a little bit of uncertainty with our services. But in general what’s good about LPS is that because we have such strong relationships with the largest lenders in the country, our customers tend to be the ones that are doing the acquiring. So we tend to come out on the positive side. What are the growth opportunities for Lender Processing Services? When we look at our growth opportunities, the fact that we’ve built a very comprehensive set of solutions that leverage technology and other services – everything a lender needs to operate on a daily basis – we’re consistently in discussions with our customers about where we can help them become more efficient. And as you’ve seen origination and re-fi volumes come down, that’s put a lot of pressure on lenders to find ways to keep their margins high as those revenue-producing transactions continue to decrease. On the other side, as foreclosure transactions are increasing, well foreclosure transactions don’t generate any new revenues for lenders. So they’re looking to process foreclosures as efficiently as possible. The fact that we provide the solutions to help them process efficiently the front-end origination and re-fi transactions, as well as handle the foreclosure transactions on the back end, that creates opportunities for us to provide new solutions then that help our lenders process more efficiently. Additionally, when you look at the market today, there is a great need for increased risk management solutions. You’ve seen in the past that lenders have done underwriting on the front on when a loan is originated. They’ve done certain risk management processes on the back end when a loan goes into foreclosure or it starts to pay late. But they haven’t done a real good job of doing portfolio monitoring over the life of a loan to predict when a loan could potentially go bad 12 months in advance. So we’ve expended a lot of resource on building out our data and analytical capabilities to give our lenders better solutions for managing risk on a go-forward basis. And the other thing we’re seeing in the industry is there’s a great deal of centralization going on in the industry right now. Where in the past you may have seen lenders really push a lot of the origination-based activities out to their wholesale markets – such as using mortgage brokers or even their local lending branches – you’re seeing lenders, because of risk, decide that if I’m going to make loans I’m going to make those on a more centralized basis so I can really control that underwriting. Well that’s a situation that really creates an opportunity for LPS because we provide those centralized type services that help them bring those transactions in and do that underwriting on a centralized basis. So those are just a few examples of the opportunities we have. About NYSE 4 ON THE FLOOR: The New York Stock Exchange is proud to produce NYSE 4 ON THE FLOOR, an exclusive web-cast interview program featuring the foremost decision makers, executives and leaders of our time. 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