Winners and Losers in CIT's OneWest Deal
July 24, 2014 11:00 AM
(Image: Bloomberg News)
WINNER: John Thain
The deal represents the banking industry comeback for CIT Group CEO John Thain, who was forced out as Merrill Lynch CEO in January 2009 after Merrill's takeover by Bank of America. Thain will now head a $70 billion-asset commercial and mortgage lender with a big presence in Southern California.
(Image: Bloomberg News)
LOSER: New York Community Bancorp
New York Community Bancorp was long rumored to be interested in OneWest Bank . Joseph Ficalora must now look for a deal target elsewhere.
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(Image: Bloomberg News)
WINNER: Private Equity
Hedge fund manager John Paulson (pictured) invested in OneWest Bank in 2009, taking a 24.9% stake. With the sale to CIT, Paulson is reported to have made almost $1 billion on the investment . George Soros and Michael Dell also were OneWest investors.
(Image: Bloomberg News)
LOSER: Wells Fargo
With CIT's acquisition of OneWest, it's less likely that CIT itself would be for sale. That's bad news for Wells Fargo, which in the eyes of some observers could have benefited from adding CIT's high-yielding loans .
(Image: Bloomberg News)
WINNER: CIT's Lending Team
(Image: Bloomberg News)
LOSER: CIT's Compliance Team
CIT now takes on the status of being a systemically important financial institution. That means far higher regulatory costs, and worries, as Fed Chair Janet Yellen crafts rules to promote stability in the financial markets .
(Image: Bloomberg News)
LOSER: City National
City National CEO Russell Goldsmith can now start looking over his shoulder. The Beverly Hills bank holds the biggest share of the Los Angeles market among locally owned banks . The combination of OneWest with CIT creates a more formidable rival.
(Image: Bloomberg News)
WINNER: Ellen Alemany
Ellen Alemany may have retired as a full-time banker when she stepped down as head of RBS Citizens Financial Group. But with her recent appointment to CIT's board , and with CIT's deal to get bigger, she'll able to stay active in the banking world.
