BNPL lender Affirm inks fresh forward-flow deal with Sixth Street

December 13, 2024 3:38 PM

In this week's banking news roundup: Affirm partners with Sixth Street to sell its buy now/pay later loans to the investment firm; Associated Banc-Corp promotes Steven Zandpour to deputy head of consumer and business banking; Visa Direct speeds up its money transfers; and more.

Bloomberg News

Affirm lands new forward-flow partner

Buy now/pay later lender Affirm has signed a fresh forward-flow deal with Sixth Street to sell its BNPL loans to the investment firm.

Under the agreement, Sixth Street will be able to purchase up to $4 billion in Affirm loans over a three-year period, marking Affirm's largest capital commitment to date, according to Affirm. The private credit firm will be able to top up its investment as consumers pay down their balances, which Affirm estimates will allow it to originate as much as $20 billion in new loans over the period. Affirm loans have a weighted average life between four and five months.

The partnership comes as Affirm looks to shore up capital to fund its continued growth and hit profitability in 2025. The company's total funding capacity has grown by more than 50% over the last two years. As of Sept 30, the lender's total funding capacity was $16.8 billion. —Joey Pizzolato

Steven Zandpour

Associated picks deputy consumer head, appoints new CEO for trust subsidiary

Associated Banc-Corp has promoted Steven Zandpour to deputy head of consumer and business banking and will add him to the company's executive leadership team on Jan. 1, the Milwaukee-based company said in a press release.

Zandpour joined Associated from BMO Financial Group in January of this year as director of retail banking. He will continue to report to David Stein, who remains the head of Associated's consumer and business banking segment, a company spokesperson said in an email.

Associated also appointed Heath Sorenson to be the next CEO of its subsidiary business, Associated Trust, effective Feb. 1, according to a separate press release. Sorenson will succeed longtime executive John Thayer, who is transitioning into a full-time advisory role.

Sorenson joined Associated's private wealth business this week. He most recently worked at Midland States Bank. —Allissa Kline

Visa Direct to speed up money transfers to 1 minute or less

Visa plans to reduce the time in which funds will appear in U.S. bank accounts when sent through its real-time money movement service, Visa Direct.

Starting in April 2025, transferred funds will be available in customers' accounts in one minute or less, the payment processor said Thursday. Visa Direct reaches 99% of bank accounts in the U.S. and has more than 11 billion endpoints including cards, accounts and digital wallets around the world.

"Faster payments are crucial for the modern economy, and this move by Visa is a significant step forward," said Reed Luhtanen, executive director and CEO, U.S. Faster Payments Council, in a statement. Visa is a member of the Faster Payments Council. —Joey Pizzolato

VersaBank preps for US point-of-sale financing expansion

Canada-based VersaBank is shifting some staff to its newly bought U.S. bank as it begins expanding in the country.

The team moving to VersaBank USA will look to replicate their work in Canada, where the bank runs a financing division for point-of-sale lenders. Over its 14-year existence, that division has offered some 10.5 billion Canadian dollars ($7.4 billion) in financing without any loan losses, VersaBank CEO David Taylor said in a news release.

Mike Dixon and David Robinson, two top leaders at the Canadian bank's receivable purchase program group, will take on similar roles in the U.S. bank. Nick Kristo, a longtime VersaBank risk executive, will also become chief credit officer of VersaBank USA.

The bank bought the U.S. depository Stearns Bank Holdingford N.A., which was part of Minnesota-based Stearns Financial Services, earlier this year after receiving regulatory approval. The digital bank aims to scale up its U.S. receivable purchase program in 2025 amid what it pegs as significant growth potential in the American point-of-sale market. —Polo Rocha

President of CRE-heavy Valley National to retire next year

Regional lender Valley National Bancorp said President Thomas Iadanza will retire in June.

Iadanza has been key to "Valley's growth efforts and evolution to a leading regional bank," the $62 billion-asset company said Wednesday.

The New Jersey bank's stock has struggled over the last two years as investors worry about risks in the commercial real estate market, where Valley has a large concentration.

The bank has long distinguished its CRE portfolio as far less risky, as it's made up of loans on many small buildings rather than the big Manhattan office towers that have come under stress. Even so, it's been cutting back its exposure to CRE.

In November, Valley raised $400 million in capital to accelerate its ongoing CRE reduction. The bank also said this month that it closed on the sale of nearly $1 billion in CRE loans to the investment firm Brookfield Asset Management.

Valley took only a 1% discount on the sale, which CEO Ira Robbins said shows "the strength and desirability" of Valley's CRE loans.

In October, Valley also announced its former chief financial officer would leave the bank. —Polo Rocha

JPMorgan names Hershey CEO Michele Buck to its board

JPMorgan Chase elected Michele Buck, the chief executive officer of U.S. chocolate maker Hershey, to its board.

Buck, 63, will become a director in March, the New York-based bank said Thursday in a statement. The executive has more than three decades of experience transforming businesses and held several senior roles at Hershey, including chief operating officer, before becoming its CEO in 2017.

"Michele Buck has deep experience leading large, complex global organizations and guiding transformational change," JPMorgan CEO Jamie Dimon said in the statement.

Mondelez International, the snacks and sweets company, has been exploring an acquisition of Hershey in a potential deal that would create a food giant with combined sales of almost $50 billion. Hershey's owner snubbed the preliminary approach, Bloomberg reported this week. Hershey previously rejected a bid from Mondelez in 2016. —Sally Bakewell, Bloomberg News

Citi sees SEAsia as target to diversify client supply chains

Citi sees potential in Southeast Asia, where client activity at the bank is up double digits across its Association of Southeast Asian Nations trade corridors with other markets, the Business Times reported Thursday, citing Jason Rekate, co-head of corporate banking at the U.S. bank.

The region — favored for its relative stability, geographic location and talent pool — has "become a really interesting target" and makes it a good region for businesses to diversify their supply chains, Rekate told BT in an interview.

Global tensions have raised the desire for multinationals to diversify, he said.

Indonesia is seen as a hot spot for metals, Malaysia is supportive of building industrial parks and Vietnam is known for its tech manufacturing, Rekate said, adding that he sees strong activity in the technology and automotive sectors where his clients are thinking more creatively about where to produce and manufacture. —Elffie Chew, Bloomberg News

Goldman Sachs names Omar Alzaim as Saudi CEO

Goldman Sachs has appointed Omar Alzaim as chief executive officer of its Saudi Arabia operations as it looks to boost its presence in the country.

Alzaim will also continue in his role as head of investment banking for Saudi Arabia, according to an internal memo seen by Bloomberg. He joined Goldman in 2021 as an executive director and was named managing director in 2023. Before that, he served as an associate director in the investment banking advisory team at HSBC Saudi Arabia.

He succeeds Khalid Albdah, who left Goldman after nearly a decade in October. Albdah has since been named head of the Middle East, North Africa and new markets business of Neuberger Berman.

Earlier this year, Goldman became the first Wall Street firm to receive a license to set up its regional headquarters in the kingdom. In October, it announced plans to open an office in Riyadh's business hub, the King Abdullah Financial District. —Matthew Martin, Bloomberg News