CIT Group Inc. (NYSE: CIT), a provider of commercial lending and leasing services, announced Monday that it has completed its previously announced acquisition of IMB Holdco LLC, the parent company of OneWest Bank N.A.—the former parent company of reverse mortgage originator Financial Freedom—for approximately $3.4 billion in cash and stock.
The combined company, CIT Group Inc., has more than $65 billion in assets and more than $30 billion of deposits, CIT Group said. As part of the transaction, CIT Bank merged with and into OneWest Bank, which was renamed CIT Bank, N.A.
CIT Bank, N.A. operates an Internet banking franchise, as well as a network of 70 retail branches throughout Southern California as OneWest Bank, a division of CIT Bank, N.A.
“The completion of this transaction advances our strategic efforts to build a leading commercial banking franchise,” said John A. Thain, chairman and Chief Executive Officer of CIT, in a press release. “Through the combination of our national lending and leasing platform with OneWest’s wholesale lending and branch banking franchise, we’ve created a differentiated provider of banking services for small and middle market businesses. I look forward to working with our newest colleagues as we integrate our two organizations, serve the needs of our customers and communities and realize the benefits of this transaction for our shareholders.”
CIT Group will continue to be led by its chairman and Chief Executive Officer John A. Thain. Steven T. Mnuchin, former chairman of IMB Holdco LLC, joined CIT Group Inc. as vice chairman and a member of its board of directors.
In addition, Al Frank, a former independent director of OneWest Bank, joined the CIT Board, which increased its size from 13 to 15 members.
Under the terms of the transaction, IMB Holdco LLC shareholders received approximately $1.867 billion in cash and approximately 30.9 million shares of CIT, as well as approximately 168,000 restricted stock units of CIT, the company said. The transaction, first announced on July 22, 2014, has received all required regulatory approvals.
Previously, OneWest Bank was the former parent company of the now defunct reverse mortgage originator Financial Freedom.
OneWest Bank acquired Financial Freedom in a 2009 purchase from The Federal Deposit Insurance Corporation (FDIC). In March of 2011, OneWest announced the company was exiting the reverse mortgage business and shutting down Financial Freedom.
As a result of closing Financial Freedom, OneWest announced in June 2011 that the company had laid off 65 employees at its Financial Freedom offices in Irvine, Calif.
Written by Cassandra Dowell