OneWest Bank is a national bank with 75 retail branches in southern California and approximately $12 billion in deposits as of June 2013.
In March 2009, OneWest purchased many assets from the Independent National Mortgage Corporation, more commonly known as IndyMac, after IndyMac filed for Chapter 7 bankruptcy.
History
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In March 2009, the Federal Deposit Insurance Corporation (FDIC) held an auction for IndyMac Bank, which it had seized in 2008, and sold it to IMB HoldCo LLC. The FDIC said at the time that IMB Management Holdings LP, a limited partnership composed primarily of hedge funds, controlled IMB Holdco LLC. The FDIC also said that IMB HoldCo was the only bidder for all of the IndyMac Bank assets. IMB HoldCo did not bid on the uninsured deposits at IndyMac Bank. There were a number of conditions of the FDIC sale to IMB HoldCo LLC, including that IMB HoldCo would capitalize OneWest with approximately $1.3 billion in cash.
As another condition of the sale IMB HoldCo also agreed to continue the FDIC’s existing loan modification program. The FDIC also agreed to share losses on a portfolio of qualifying loans, with IMB HoldCo assuming the first 20% of losses, with the FDIC sharing losses 80/20 for the next 10% of losses and 95/5 thereafter. Finally under a participation structure on an approximately $2 billion portfolio of construction and other loans, the FDIC will receive a majority of all cash flows generated.
OneWest Bank began operations as a newly formed Pasadena, California-based federal savings bank on March 19, 2009 with its acquisition of certain assets and certain limited liabilities of IndyMac Federal Bank, FSB from the FDIC. The newly formed bank opened its doors with 33 branches and approximately $16 billion of assets.
Since its formation, OneWest Bank has grown through acquisitions from the FDIC of certain assets, loans, and deposits of other California-based financial institutions. On December 18, 2009, OneWest completed the acquisition of the banking operations of First Federal Bank of California, including $6 billion in assets and $5 billion in deposits. On February 19, 2010, OneWest acquired all of the deposits and certain assets of La Jolla Bank, FSB, including $4 billion in assets and $3 billion in deposits.
In December 2009, OneWest Bank announced the creation of the OneWest Foundation, a new nonprofit public-benefit corporation funded with a $10,000,000 contribution from OneWest Bank, FSB. The Foundation is being established to actively invest in the communities in which the Bank operates its branch network. In February 2010, OneWest Bank entered into a purchase and assumption agreement with the FDIC for acquisition of the deposits and certain assets of La Jolla Bank, FSB. Under the terms of the transaction, OneWest acquired $3.6 billion in assets. The FDIC and OneWest agreed to a lossâ€sharing agreement covering a majority of the acquired loans from La Jolla Bank.
On October 4, 2010 OneWest Bank, announced that it has implemented the Principal Reduction Alternative (PRA) loan modification program as outlined under the Home Affordable Modification Program (HAMP). With this announcement, OneWest becomes one of the first servicers to launch the program. In November 2010, OneWest Bank, purchased of a $1.4 billion multifamily and commercial real estate loan portfolio from Citibank, N.A. The portfolio, which includes approximately 600 loans, is a strategic addition to OneWest Bank’s growing Commercial Real Estate lending business.
As of November 2010, OneWest Bank has been recognized as the 40th largest among US banks and thrifts by SNL Financial.
On July 22, 2014 it was announced that CIT Group would be acquiring OneWest Bank for $3.4 billion. After the acquisition closed, it was reported that the bank would be merged with CIT's commercial banking subsidiary and be called CIT Bank.
Controversial foreclosures on IndyMac loans
In enforcing its rights under the loans purchased from IndyMac, OneWest Bank has taken a much more aggressive approach to foreclosing on properties.
On November 25, 2009, Judge Spinner in Long Island, New York penalized OneWest for their “harsh, repugnant, shocking and repulsive†actions in trying to work out a distressed mortgage, by canceling the debt in favor of the borrower. A year after the New York Judge Spinner wiped away the debt, an appellate panel ruled that the judge had no right to do it. While Judge Spinner ruled that the bank's practices warranted him erasing the homeowners' debt, the appellate judges found that he had no authority to render such a judgmentâ€"and did not give the bank fair notice that such consequences were even on the table.
On December 8, 2009 OneWest worked with the Hennepin County, Minnesota Sheriff’s department to change the locks on a distressed home despite stating in a Nov. 25 e-mail that they were rescinding both the foreclosure and the sheriffs sale. OneWest Bank said, "You expressed concern that … you and your mother will be evicted from the property. Rest assured, that will not take place …". Changing the locks was done without any court action which bypasses acknowledged and mandated Due Process on home foreclosures in Minnesota.
Additionally several judges have issued Temporary Restraining Orders and Preliminary Injunctions against OneWest preventing OneWest from foreclosing on properties where the borrower claims OneWest failed to follow proper procedure in foreclosing on the property or otherwise violated the borrower's rights.
See also
- 2008 United States bank failures
- Subprime mortgage crisis
References
External links
- OneWest Bank
- OneWest Mortgage
- OneWest Bank Home Loans
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