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Victory Capital Management did not fit with KeyCorp's retail strategy so the Cleveland company decided to sell it and has since asked regulators to let it use capital from the deal to buy back shares, CEO Beth Mooney said.
April 19 -
Bank of America (BAC) has agreed to pay the bond insurer MBIA $1.6 billion to settle a five-year-old dispute over losses related to soured mortgage-backed securities, according to news reports.
May 6 -
Shares of Bank of America (BAC) and Wells Fargo (WFC) have been on a roll in recent days and the New York attorney general's pledge Monday to sue the banking giants did nothing to slow their momentum.
May 7
Score one for the little, er, midsize guy.
A real estate arm of KeyCorp (KEY) has agreed to purchase more than $100 billion of servicing rights on commercial and multifamily loans from Bank of America (BAC), Keycorp said in a press release Thursday.
KeyBank Real Estate Capital, the commercial real estate business unit of KeyCorp, will purchase substantially all of the third-party commercial mortgage servicing business from B of A's global mortgages and securitized products business. The portfolio includes servicing for a variety of private investors, who must OK the deal along with regulators and ratings agencies, the release said.
The deal, expected to be completed before June 30, would make KeyCorp the third-largest named servicer of such loans in the U.S. with a servicing portfolio of $205 billion, the release said.
"This acquisition helps to ensure that Key is well-positioned for growth, and represents our willingness to invest in our corporate bank business," Beth Mooney, the chairman and chief executive of Cleveland-based KeyCorp, said in the release.
The price was undisclosed.
The $89 billion-asset KeyCorp has announced several major deals since early last year. It purchased 37 former HSBC branches in western New York from First Niagara Financial Group (FNFG) for $110 million last year, and it agreed in February to sell Victory and its broker-dealer affiliate to Crestview Partners for $246 million.
Analysts were puzzled that KeyCorp would a get rid of a fee generator like Victory at a time of shrinking margins on loans, but Mooney has said it
Meanwhile, Bank of America is still try to overcome the crisis-era meltdown in mortgages and has been jettisoning assets as its seeks to comply with stiff capital requirements and right its business.
New York Attorney General Eric Schneiderman this week accused B of A and Wells Fargo (WFC) of violating the terms of last year's national mortgage settlement and said he intends to sue the two banks over 339 different servicing failures since October.
Bank of America reported a
Under the deal with B of A announced Thursday, KeyCorp said Berkadia Commercial Mortgage LLC would act as its sub-servicer on the primary servicing acquired from Bank of America and that KeyCorp has agreed to acquire Berkadia's CMBS special servicing business.
B of A's total commercial mortgage servicing portfolio was valued at $110.5 billion at March 31, the release said. The deal includes a CMBS special servicing portfolio of about $14 billion, the release said.
The deal would not affect B of A's commercial real estate banking business, the release said.