Back to GetFilings.com
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(Mark one)
/X/ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2003
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File Number: 333-83816-12
Salomon Brothers Mortgage Securities VII, Inc.
Mortgage Pass-Through Certificates
Series 2003-HYB1
(Exact name of registrant as specified in its charter)
Delaware 13-3439681
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
390 Greenwich Street
New York, NY 10013
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 723-8604
Securities registered pursuant to Section 12(b) of the Act:
NONE.
Securities registered pursuant to Section 12(g) of the Act:
NONE.
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes X No ___
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K ( 229.405 of this chapter) is not contained
herein, and will not be contained, to the best of registrant's knowledge,
in definitive proxy or information statements incorporated by reference
in Part III of this Form 10-K or any amendment to this Form 10-K.
Not applicable.
Indicate by check mark whether the registrant is an accelerated filer
(as defined in Exchange Act Rule 12b-2).
Yes___ No X
State the aggregate market value of the voting and non-voting common
equity held by non-affiliates computed by reference to the price at which
the common equity was last sold, or the average bid and asked price of
such common equity, as of the last business day of the registrant's most
recently completed second fiscal quarter.
Not applicable.
Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of the latest practicable date.
Not applicable.
List hereunder the following documents if incorporated by reference and
the Part of the Form 10-K (e.g. Part I, Part II, etc.) into which the
document is incorporated: (1)Any annual report to security holders; (2)
Any proxy or information statement; and (3)Any prospectus filed pursuant
to Rule 424(b) or (c) under the Securities Act of 1933. The listed
documents should be clearly described for identification purposes (e.g.
annual report to security holders for fiscal year ended December 24, 1980).
Not applicable.
PART I
Item 1. Business.
Omitted.
Item 2. Properties.
See Item 15(a), Exhibits 99.1, 99.2, and 99.3, for information
provided in lieu of information required by Item 102 of
Regulation S-K.
Item 3. Legal Proceedings.
The registrant knows of no material pending legal proceedings
involving the trust created under the Pooling and Servicing
Agreement (the Trust), the Trustee, the Servicer or the
registrant with respect to the Trust other than routine
litigation incidental to the duties of the respective parties.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
PART II
Item 5. Market for Registrant's Common Equity and Related Stockholder
Matters.
No established public trading market for the Certificates exists.
Records provided to the Trust by the DTC and the Trustee
indicate that as of December 31, 2003, the number of holders of
record for each class of Certificate were as follows:
Class A 6
Class R 1
Class B-1 3
Class B-2 3
Class B-3 3
Class B-4 1
Class B-5 1
Class B-6 1
Total: 19
Item 6. Selected Financial Data.
Omitted.
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operation.
Omitted.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk.
Not applicable.
Item 8. Financial Statements and Supplementary Data.
See Item 15(a), Exhibits 99.1, 99.2, 99.3, for information
provided in lieu of information required by Item 302 of
Regulation S-K.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
None.
Item 9A. Controls and Procedures.
Not applicable.
PART III
Item 10. Directors and Executive Officers of the Registrant.
Not applicable.
Item 11. Executive Compensation.
Not applicable.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
Not applicable.
Item 13. Certain Relationships and Related Transactions.
Not applicable.
Item 14. Principal Accounting Fees and Services.
Not applicable.
PART IV
Item 15. Exhibits, Financial Statement Schedules, and Reports on Form 8-K.
(a) Exhibits
(31.1) Rule 13a-14(a)/15d-14(a) Certification
(99.1) Annual Independent Accountants' Servicing Reports concerning
servicing activities for the year ended December 31, 2003.
a) National City Mortgage Co, as Servicer
(99.2) Report of Management as to Compliance with Minimum Servicing
Standards for the year ended December 31, 2003.
a) National City Mortgage Co, as Servicer
(99.3) Annual Statements of Compliance under the Pooling and Servicing
Agreements for the year ended December 31, 2003.
a) National City Mortgage Co, as Servicer
(99.4) Aggregate Statement of Principal and Interest Distributions to
Certificate Holders.
(b) On November 25, 2003, December 8, 2003, and January 8, 2004 reports on
Form 8-K were filed by the Company in order to provide the statements
for the monthly distributions to holders of the Certificates. No other
reports on Form 8-K have been filed during the last quarter of the
period covered by this report.
(c) Not applicable.
(d) Omitted.
Filed herewith.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized:
Salomon Brothers Mortgage Securities VII, Inc.
Mortgage Pass-Through Certificates
Series 2003-HYB1
(Registrant)
Signed: Wells Fargo Bank, N.A. as Master Servicer
By: Barry Akers, Vice President
By: /s/ Barry Akers, Vice President
Dated: March 30, 2004
SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO
SECTION 15(d) OF THE ACT BY REGISTRANTS WHICH HAVE NOT REGISTERED
SECURITIES PURSUANT TO SECTION 12 OF THE ACT.
(a)(i) No annual report is provided to the Certificateholders other than
with respect to aggregate principal and interest distributions.
(a)(ii) No proxy statement, form of proxy or other proxy soliciting
material has been sent to any Certificateholder with respect to any
annual or other meeting of Certificateholders.
Exhibit Index
Exhibit No.
Ex-31.1 Rule 13a-14(a)/15d-14(a) Certification
I, Barry Akers, certify that:
1. I have reviewed this annual report on Form 10-K, and all reports on
Form 8-K containing distribution or servicing reports filed in
respect of periods included in the year covered by this annual report,
of Salomon Brothers Mortgage Securities VII, Inc. Mortgage Pass-Through
Certificates, Series 2003-HYB1;
2. Based on my knowledge, the information in these reports, taken as a
whole, does not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements made,
in light of the circumstances under which such statements were made,
not misleading as of the last day of the period covered by this
annual report;
3. Based on my knowledge, the distribution or servicing information
required to be provided to the Trustee by the Servicer under the
Pooling and Servicing or similar, agreement, for inclusion in these
reports is included in these reports;
4. I am responsible for reviewing the activities performed by the master
servicer under the pooling and servicing, or similar, agreement, and
based on upon my knowledge and the annual compliance review required
under that agreement, and except as disclosed in the reports, the
master servicer has fulfilled its obligations under that agreement;
and
5. The reports disclose all significant deficiencies relating to the
servicer's compliance with the minimum servicing standards based upon
the report provided by an independent public accountant, after
conducting a review in compliance with the Uniform Single Attestation
Program for Mortgage Bankers or similar procedure, as set forth in
the pooling and servicing, or similar, agreement, that is included in
these reports.
In giving the certifications above, I have reasonably relied on
information provided to me by the following unaffiliated parties:
National City Mortgage Co. as Servicer.
Date: March 30, 2004
/s/ Barry Akers
Signature
Vice President
Title
Ex-99.1 (a)
(LOGO) ERNST & YOUNG
Ernst & Young LLP
1300 Huntington Building
925 Euclid Avenue
Cleveland, Ohio 44115
Phone: (216) 861-5000
www.ey.com
Report on Management's Assertion on Compliance
with the Specified Minimum Servicing Standards Set Forth in the
Uniform Single Attestation Program for Mortgage Bankers
Report of Independent Accountants
Board of Directors
National City Mortgage Co.
We have examined management's assertion, inc1uded in the accompanying report
titled Report of Management, that National City Mortgage Co. (NCM) complied with
the servicing standards identified in Exhibit A to the Report of Management (the
specific minimum servicing standards) as set forth in the Mortgage Bankers
Association of America's Uniform Single Attestation Program for Mortgage Bankers
(USAP) during the year-ended December 31, 2003. Management is responsible for
NCM's compliance with the specified minimum servicing standards. Our
responsibility is to express an opinion on management's assertions about NCM's
compliance based on our examination.
Our examination was made in accordance with attestation standards established by
the American Institute of Certified Public Accountants and, accordingly,
included examining, on a test basis, evidence about NCM's compliance with the
specified minimum servicing standards and performing such other procedures as we
considered necessary in the circumstances. We believe that our examination
provides a reasonable basis for our opinion. Our examination does not provide a
legal determination on NCM's compliance with specified minimum servicing
standards.
In our opinion, management's assertion that NCM complied with the aforementioned
specified minimum servicing standards during the year ended December 31, 2003,
is fairly stated, in all material respects.
/s/ Ernst & Young LLP
February 25, 2004
A Member Practice of Ernst & Young Global
Ex-99.2 (a)
Management's Assertion on Compliance with the Specified Minimum
Servicing Standards Set Forth in the Uniform Single Attestation Program
for Mortgage Bankers
Report of Management
We, as members of management of National City Mortgage Co. (NCM), are
responsible for complying with the servicing standards identified in the
attached Exhibit A (the specified minimum servicing standards) as set forth in
the Mortgage Bankers Association of America's Uniform Single Attestation
Program for Mortgage Bankers (USAP). We are also responsible for
establishing and maintaining effective internal control over compliance with
these specified minimum servicing standards. We have performed our
evaluation of NCM's compliance with the specified minimum servicing
standards as of December 31, 2003 and for the year then ended. Based on this
evaluation, we assert that during the year ended December 31, 2003, NCM
complied, in all material respects, with the specified minimum servicing
standards set forth in the USAP.
As of December 31, 2003 and for the year then ended, NCM had in effect a
fidelity bond policy in the amount of $200 million and an errors and omissions
policy in the amount of $200 million.
/s/ Steven M. Scheid
Steven M. Scheid, Senior Vice President
February 25, 2004
Exhibit A
Specified Minimum Servicing Standards
I. Custodial Bank Accounts
1. Reconciliations shall be prepared on a monthly basis for all custodial
bank accounts and related bank clearing accounts. These reconciliations
shall:
a. be mathematically accurate;
b. be prepared within forty-five (45) calendar days after the cutoff date.
The cutoff date is the date as of which a bank account is reconciled
every month. It may, or may not, coincide with a prescribed investor
reporting date but shall be consistent from period to period;
c. be reviewed and approved by someone other than the person who prepared
the reconciliation; and
d. document explanations for reconciling items. These reconciling items
shall be resolved within ninety (90) calendar days of their original
identification.
2. Funds of the servicing entity shall be advanced in cases where there is an
overdraft in an investor's or a mortgagor's account.
3. Each custodial account shall be maintained at a federally insured
depository institution in trust for the applicable investor.
4. Escrow funds held in trust for a mortgagor shall be returned to the
mortgagor within thirty (30) calendar days of payoff of the mortgage loan.
II. Mortgage Payments
1. Mortgage payments shall be deposited into the custodial bank accounts and
related bank clearing accounts within two (2) business days of receipt.
2. Mortgage payments made in accordance with the mortgagor's loan documents
shall be posted to the applicable mortgagor records within two (2)
business days of receipt.
3. Mortgage payments shall be allocated to principal, interest, insurance,
taxes or other escrow items in accordance with the mortgagor's loan
documents.
4. Mortgage payments identified as loan payoffs shall be allocated in
accordance with the mortgagor's loan documents.
Exhibit A
Specified Minimum Servicing Standards (continued)
III. Disbursements
1. Disbursements made via wire transfer on behalf of a mortgagor or investor
shall be made only by authorized personnel.
2. Disbursements made on behalf of a mortgagor or investor shall be posted
within two (2) business days to the mortgagor's or investor's records
maintained by the servicing entity.
3. Tax and insurance payments shall be made on or before the penalty or
insurance policy expiration dates, as indicated on tax bills and insurance
premium notices, respectively, provided that such support has been
received by the servicing entity at least thirty (30) calendar days prior
to these dates.
4. Any late payment penalties paid in conjunction with the payment of any tax
bill or insurance premium notice shall be paid from the servicing
entity's funds and not charged to the mortgagor, unless the late payment
was due to the mortgagor's error or omission.
5. Amounts remitted to investors per the servicer's investor reports shall
agree with cancelled checks, or other form of payment, or custodial bank
statements.
6. Unissued checks shall be safeguarded so as to prevent unauthorized access.
IV. Investor Accouting and Reporting
1. The servicing entity's investor reports shall agree with, or reconcile to,
investors' records on a monthly basis as to the total unpaid principal
balance and number of loans serviced by the servicing entity.
V. Mortgagor Loan Accounting
1. The servicing entity's mortgage loan records shall agree with, or
reconcile to, the records of mortgagors with respect to the unpaid
principal balance on a monthly basis.
2. Adjustments on adjustable rate mortgage (ARM) loans shall be computed
based on the related mortgage note and any ARM rider.
3. Escrow accounts shall be analyzed, in accordance with the mortgagor's loan
documents, on at least an annual basis.
Exhibit A
Specified Minimum Servicing Standards (continued)
V. Mortgagor Loan Accounting (continued)
4. Interest on escrow accounts shall be paid, or credited, to mortgagors in
accordance with the applicable state laws.
VI. Delinquencies
1. Records documenting collection efforts shall be maintained during the
period a loan is in default and shall be updated at least monthly. Such
records shall describe the entity's activities in monitoring delinquent
loans including, for example, phone calls, letters and mortgage payment
rescheduling plans in cases where the delinquency is deemed temporary
(i.e., illness or unemployment).
VII. Insurance Policies
1. A fidelity bond and errors and omissions policy shall be in effect on the
servicing entity throughout the reporting period in the amount of coverage
represented to investors in management's assertion.
Ex-99.3 (a)
National City Mortgage Co.
232 Newmark Drive. Miamisburg, Ohio 45342
Mortgage Telephone (937) 910-1200
Mailing Address:
P.O. Box 1820
Dayton, Ohio 45401-1820
EMC
C/o Wells Fargo Bank Minnesota NA
Attn: Mike Williams
9062 Old Annapolis Road
Columbia, Maryland 21045
RE: Officer's Certification -National City Mortgage Investor Number 436
Dear Master Servicer:
The undersigned Officer certifies the following for the 2003 fiscal year:
a. I have reviewed the activities and performance of the Servicer during the
preceding fiscal year
under the terms of the Servicing Agreement, Trust Agreement, Pooling and
Servicing Agreement and/or Seller/Servicer Guide and to the best of this
Officer's knowledge, the Servicer has fulfilled all of its duties,
responsibilities or obligations under these Agreements throughout such year, or
if there has been a default or failure of the servicer to perform any of such
duties, responsibilities or obligations, a description of each default or
failure and the nature and status thereof has been reported to EMC c/o Wells
Fargo Bank Minnesota NA;
b. I have confirmed that the Servicer is currently an approved FNMA or FHLMC
servicer in good standing;
c. I have confirmed that the Fidelity Bond, the Errors and Omissions Insurance
Policy and any other bonds required under the terms of the Servicing Agreement,
Trust Agreement, Pooling and Servicing Agreement and/or Seller/Servicer Guide
are in full force and effect;
d. All premiums for each Hazard Insurance Policy, Flood Insurance Policy (if
applicable) and Primary Mortgage Insurance Policy (if applicable), with respect
to each Mortgaged Property, have been paid and that all such insurance policies
are in full force and effect;
e. All real estate taxes, governmental assessments and any other expenses
accrued and due, that if not paid could result in a lien or encumbrance on any
Mortgaged Property, have been paid, or if any such costs or expenses have not
been paid with respect to any Mortgaged Property, the reason for the non-payment
has been reported to EMC c/o Wells Fargo Bank Minnesota NA;
f. All custodial accounts have been reconciled and are properly funded; and
g. All annual reports of Foreclosure and Abandonment of Mortgaged Property
required per section 6050H, 6050J and 6050P of the Internal Revenue Code,
respectively, have been prepared and filed.
Certified By:
/s/ Mary Beth Criswell
Officer Mary Beth Criswell
Vice President
Title
February 13, 2004
Date
No one Cares More!
Ex-99.4
Schedule of Year-To-Date Principal and Interest Distributions to
Certificateholders
Class Interest Principal Losses Ending Balance
A 1,772,062.44 2,263,181.85 0.00 167,755,818.15
R 0.35 100.00 0.00 0.00
B-1 27,473.98 8,156.78 0.00 2,620,843.22
B-2 10,074.15 2,990.92 0.00 961,009.08
B-3 7,325.70 2,174.93 0.00 698,825.06
B-4 3,668.07 1,089.02 0.00 349,910.98
B-5 2,748.44 815.99 0.00 262,184.01
B-6 3,665.59 1,088.28 0.00 349,674.48