HomeStreet to Offload $990M Multifamily Loan Portfolio to Bank of America – Commercial Observer

Financial services company HomeStreet is set to sell roughly $990 million worth of multifamily commercial real estate loans to Bank of America (BAC), the Seattle-based firm announced Friday.

Bạn đang xem: HomeStreet to Offload $990M Multifamily Loan Portfolio to Bank of America – Commercial Observer

The price tag on the loan sale is reflective of the “current interest rate environment” as the loans being sold are “primarily lower-yielding loans with longer duration than the overall portfolio,” HomeStreet CEO Mark Mason said in a statement Friday.

Xem thêm : Lazard Equity Franchise Portfolio Q3 2024 Commentary (Mutual Fund:LZFIX)

SEE ALSO: Why Nonprofits Are Taking More New York Office Space

The deal, which is expected to close before the end of 2024, will be split into two parts, according to Bloomberg, which first reported the news. About $652 million was expected to close Friday, while about $338 million is set to close around Dec. 30, Bloomberg reported.

“Entering into this agreement and completing the sale of $990 million of multifamily loans is the first step in implementing a new strategic plan, which we expect to result in a return to profitability for the bank and on a consolidated basis early next year,” Mason said.

Xem thêm : Novo Resources acquires two high-grade gold projects in Australia

HomeStreet will also use the proceeds from the loan sale to pay off Federal Home Loan Bank advances and brokered deposits, which “carry substantially higher interest rates than our core deposits,” Mason added.

It’s unclear what Bank of America plans to do with the multifamily loan portfolio. A spokesperson for HomeStreet declined further comment, while a spokesperson for Bank of America did not immediately respond to a request for comment.

HomeStreet had previously announced plans to sell some of its loans after reporting a net loss of $7.3 million in the third quarter and avoiding a potential acquisition by FirstSun Capital Bancorp in October, Bloomberg reported.

Isabelle Durso can be reached at [email protected].