Ally Financial will sell to Quicken Loans the rest of the agency mortgage servicing rights for almost $280 million.
On January 31st, the loans had an unpaid principal balance of almost $34 billion and the deal is to be signed during the second quarter, as it awaits approval from Fannie Mae and Freddie Mac.
“Going forward, the bank’s full focus and resources will be centered on its leading direct banking franchise and advancing its customer-centric deposit activities, as well as continuing to grow its key role in Ally’s auto finance operation,” Barbara Yastine, 53, chief executive officer of the Ally Bank unit, said in the statement.
The US Treasury Department still has a 75% stake in Ally Financial, after the company received a $17.2 billion taxpayer bailout. Last week Ally’s capital plan was rejected by the Federal Reserve and regulators said that the company’s capital ratios and planning process didn’t meet standards. On March 12th, the lender agreed to sell Ocwen Financial Corp. agency mortgage servicing rights for $585 million.
Earlier this month, the government’s annual ‘stress test’ showed that Ally Financial would be the only one among the nation’s 18 largest banks that would not survive a severe recession in the US. The Fed’s data also shows that under the most severe scenario Ally Financial would have a much smaller capital buffer against losses compared with the other banks.