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A government tool for unloading failed bank assets and minimizing FDIC losses may be used as a vehicle to publicly subsidize private gains in the proposed merger between CIT Group and OneWest Bank.
November 20 -
The $44 billion-asset specialty lender viewed its pending purchase of OneWest Bank as its way to get significantly over the $50 billion threshold for systemically important financial institutions. But CIT CEO John Thain is all for a proposal that would raise the SIFI bar higher.
October 28 -
CIT Group's deal for OneWest is further proof that buyers are increasingly eyeing deposits, not assets, as they prepare for an increase in loan demand and look to position themselves for rising interest rates.
July 29
Regulators are taking their review of CIT Group's agreement to buy OneWest Bank to a public forum, following community activists' complaints about the deal.
The Federal Reserve System, the Treasury Department and the Office of the Comptroller of the Currency said Friday that they will hold a public meeting on Feb. 26. It will be held from 8 a.m. to 4 p.m. at the Los Angeles branch of the Federal Reserve Bank of San Francisco.
CIT's $3.4 billion deal to acquire OneWest and its holding company, IMB Holdco, was announced in July and is slated to close in the first half of the year.
Groups such as the California Reinvestment Coalition have spent months campaigning to get regulators to hold public meetings on the deal and its potential public impact. They have raised concerns about the number of foreclosures on OneWest borrowers and complained that the combined company's community-reinvestment plan would be inadequate.
"The purpose of the meeting is to collect information related to factors the [Fed] and OCC are required to consider under the Bank Holding Company Act and the Bank Merger Act," the agencies said in a news release.
Public hearings are not routine, but more common in the case of larger deals that draw public outcry. For instance, the Fed held hearings in Washington, Chicago and San Francisco in 2011 concerning Capital One Financial's deal to acquire ING Bank in Wilmington, Del. That deal was completed in 2012.
