OneWest Purchases $1.4 Billion in Commercial Property Loans From Citigroup
OneWest Bank, formed in the aftermath of IndyMac Bancorp’s failure, purchased $1.4 billion in commercial real estate loans from Citigroup Inc.
OneWest bought a portfolio that includes about 600 multifamily and commercial real estate loans, the Pasadena, California-based lender said today in a statement. The loans are on properties throughout the U.S., OneWest spokeswoman Diane Henry said. Terms of the transaction weren’t disclosed.
“These would have to be deeply discounted for the math to work,” said Walter J. Mix III, a former commissioner of the California Department of Financial Institutions who closed 30 banks during the last banking crisis in the 1990s.
The deal will reduce loans at Citi Holdings, the division Citigroup created in 2009 to dispose of businesses under a plan by Chief Executive Officer Vikram Pandit, 53, to streamline the lender. New York-based Citigroup, the third-biggest U.S. bank by assets and 12 percent owned by taxpayers, is liquidating holdings after its $45 billion bailout.
OneWest is the successor to IndyMac Bancorp, which was seized by the Federal Deposit Insurance Corp. in 2008 at an estimated cost of $10.7 billion. The FDIC has since used OneWest to absorb other failed California lenders.
Last month, OneWest hired Joseph Otting from U.S. Bancorp as president and chief executive officer. Otting led an expansion in California for U.S. Bancorp, where he was head of commercial banking and one of eight vice chairmen.
To contact the reporter on this story: Dakin Campbell in San Francisco at dcampbell27@bloomberg.net
To contact the editor responsible for this story: David Scheer at dscheer@bloomberg.net.
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