CIT Bank reached an agreement to sell its reverse mortgage servicing business, Financial Freedom, and its reverse mortgage portfolio to an undisclosed buyer.
The transaction includes the sale of mortgage servicing rights and approximately $900 million of reverse mortgage whole loans, including other real estate owned assets as of June 30, 2017. The transaction is expected to close in Q2/18 and is subject to certain regulatory and investor approvals and other customary closing conditions.
“This transaction marks another step in our plan to simplify CIT,” said Ellen R. Alemany, chairwoman and CEO of CIT. “Throughout this year we have made continued progress in transforming the company and applying our focus toward maximizing the potential of our commercial banking and deposit franchises, which are the core of our go-forward strategy. We are pleased to have reached this agreement, which will enable CIT to exit the reverse mortgage business.”
Financial Freedom was part of CIT’s acquisition of OneWest Bank in August of 2015 and, since that time, was reported in CIT’s discontinued operations. The reverse mortgage portfolio is reported as part of the company’s continuing operations.
CIT was advised by Houlihan Lokey as financial advisor and Sidley Austin as legal advisor.