First Tennessee Bank National Association, a subsidiary of First Horizon National Corp., has agreed to sell to MetLife Bank N.A., a wholly owned subsidiary of MetLife, Inc., more than 230 retail and wholesale offices nationwide and its loan origination and servicing platform.
The transaction is expected to close in the third quarter. First Horizon will retain its 21 mortgage offices in and around Tennessee and associated employees, continuing to originate home loans for customers in its banking market footprint, the company notes.
First Horizon also has agreed to sell mortgage servicing assets on approximately $20 billion of first-lien mortgage loans to MetLife Bank and enter into a subservicing agreement for the remainder of First Horizon's first-lien servicing portfolio, which is expected to total approximately $65 billion after closing. MetLife Bank has agreed to pay book value for the assets purchased subject to certain adjustments and to assume certain liabilities.
First Horizon intends to reduce its remaining servicing assets through natural portfolio run-off and additional bulk sales over the next several years, depending on market and other conditions. As a result of continuing sales of warehouse loans coupled with the initial and expected further downsizing of the servicing portfolio, First Horizon expects that assets in its mortgage banking segment should decline by at least $3 billion by year-end 2008. That reduction is expected to free up at least $200 million of tangible capital.
Source: First Horizon National Corp.
