BB&T Corp. plans to operate the former Colonial BancGroup Inc.’s mortgage-warehouse lending division, despite numerous questions surrounding the division.
The unit came under fire from the U.S. Department of Justice before the bank’s failure in August and its subsequent purchase by BB&T. Federal agents raided its Orlando, Fla., offices in search of alleged accounting irregularities regarding Colonial’s request to receive bank bailout funds. Colonial was based in Montgomery, Ala.
Winston-Salem-based BBandT acquired 346 branches and $20.1 billion in deposits in the acquisition.
BBandT (NYSE:BBT) has named Jeff Ellison president of its new lending division that provides short-term financing to mortgage companies. Ellison most recently was a senior credit officer in BB&T’s Orlando-based East Florida region.
BBandT Chief Executive Kelly King says the bank plans to expand its mortgage-warehouse lending by using Colonial’s platform.
“We did, however, take a rational look at the essence of the warehouse business done properly and determined that it is a good business for us,” he says. “We’re already doing some and with their platform, we think we can grow that in our footprint and take advantage of the good relationships they had.”
The strategy is “a classic example of I’m not throwing the baby out with the dirty bath water,” he adds.
source : http://charlotte.bizjournals.com/charlotte/stories/2009/10/19/daily39.html?ana=yfcpc
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