|
||
| Wells Fargo & Co. is launching a warehouse lending unit.The San Francisco-based institution is investing $4 billion to launch the unit in Atlanta, a spokesman confirmed to MortgageDaily.com. Wachovia Corp. executive Kenneth Logan, who previously headed up NovaStar Financial Inc’s warehouse business, will run the operation.
The story was first reported today by Bloomberg. While competitors including JPMorgan Chase & Co. and Bank of America Corp. have backed away from third-party business, Wells has held on. The latest move is a signal that Wells is digging its feet in deeper. The Wells spokesman was unable to provide additional details about the new business because the company is in a quiet period ahead of its earnings announcement on April 22. Wells was the biggest U.S. residential originator last year with production of $230.0 billion. The move by Wells couldn’t come at a better time as players including JPMorgan, National City Corp. and Franklin Bank Corp. have either recently exited the warehouse lending business or shut down altogether. The loss of warehouse liquidity has recently led to the failure of several companies including Home Loan Consultants Inc., Popular Mortgage Corp. and CU National Mortgage. Another warehouse lender, however, got a boost earlier this week. On Tuesday, Colonial BancGroup announced that a group of investors led by Taylor, Bean & Whitaker would invest $300 million in the Montgomery, Ala.-based firm. Colonial, a struggling bank, operates a warehouse business in Orlando, Fla. |
