View more on these topics

NAB in $2.3bn deal with WAMU

National Australia Bank has sold its US mortgage operation, HomeSide, to Washington Mutual Inc for AU$2.3 billion.

The latest sale includes the unit&#39s mortgage servicing rights and follows the sale in 2001 of HomeSide&#39s mortgage origination business, also to Washington Mutual.

NAB chief executive officer Frank Cicutto said: “This represents a complete exit from our mortgage banking business in the US.”

The sale expected to be completed in October 2002 will enable the bank to extend its share buyback program by AU$750 million to September 2003.

NAB said it agreed to sell SR Investment Inc, the parent company of HomeSide Lending Inc to Washington Mutual for about $1.3 billion, or AU$2.3 billion.

This will result in NAB exiting all mortgage servicing rights and related financial hedges associated with a mortgage portfolio which is projected to be about $131 million at closing.

NAB said it would book a loss of AU$104 million to cover transaction costs, closing provisions and balance sheet adjustments for the deal.

NAB will retain a portfolio of about $300 million of government guaranteed mortgages. But no mortgage servicing rights is associate with this portfolio.

The group said the sale is expected to improve its capital ratio and release about AU$ 490 million of capital.

Recommended

Skipton launch new two year fixed rate

The Skipton Building Society has launched a new 2-year fixed rate mortgage, offering borrowers an interest rate fixed at 3.99% until November 30 2004. Key features of the mortgage are: o Concessionary mortgage discount scheme 0.30% discount off variable rate (currently 5.70%) in years 3 and 4 and 0.50% discount off variable rate (currently 5.70%) […]

Buy-to-let lending continues to grow

Buy-to-let lending grew beyond £5.5bn and 58,000 loans in the first half of this year, according to CML figures. The private lettings sector has surged past the 42,000 loans, worth £4.1bn, advanced in the second half of 2001. CML figures show that the average maximum LTV requirement in the sector remains unchanged at 80% for […]

Scottish economy continues to underperform, says cebr

Official data now shows that the Scottish economy is in recession, the cebr has warned. There are some explanatory factors. First, the consumer boom which has boosted the UK economy has been much weaker in Scotland than the rest of the UK. Second, agriculture has been hit by last years foot and mouth outbreak. Third, […]

Property assets cushion negative wealth effect

Property assets, mainly housing, have provided a significant offset to the loss of wealth due to the decline in the equity market in the last few years, according to research by Standard Life Investments. In the latest edition of &#39Global Insight&#39, its monthly investment review, Standard Life Investments examines the impact of falling equity markets […]

Finance is only one hurdle for small developers

The housebuilding market in its current form simply isn’t working. We are completely over-reliant on the biggest players in the industry – the largest nine are responsible for more than 50 per cent of the new homes built in the UK. But there is a reluctance to do more, particularly in this uncertain post-Brexit world. And with […]

Newsletter

News and expert analysis straight to your inbox

Sign up