Michigan National Corp. said Thursday it signed a definitive agreement to sell its California-based warehouse mortgage lender, First Collateral Services, to Associates Corp. of North America for an undisclosed amount.
Joseph Whiteside, Michigan National's chief financial officer, said in an interview that First Collateral has $65 million in assets. its sale would not result in any material gain or loss for the bank holding company, he said.
"This was part of our California exit strategy," Mr. Whiteside added.
In an effort to quiet dissident shareholders who are pushing management to put Michigan National on the block, the $9.2 billion-asset company has been shedding assets outside its core Michigan banking business.
Two weeks ago, the bank signed a definitive agreement to sell $200 million of deposits from its Laguna Hills, Calif.-based thrift, Independence One Bank of California, to Glendale Federal Bank. Another $150 million in deposits remain.
Earlier this year, Michigan National made agreements to sell its two Texas banks, First State Bank and Trust Co., Port Lavaca, and Lockwood National Bank, to First International Bancshares, Laredo, and Comerica Inc., respectively.
At the end of September, the bank holding company sold its Michigan-based mortgage banking operation to Norwest Corp. for a $27 million gain.
First Collateral Services, based just outside San Francisco, was a unit of Independence One Bank of California.
"This is just one minor piece of the total puzzle of streamlining," said Tony Howard, a banking analyst with First of Michigan Corp. "This sale and what they are doing in general is part of a good strategic focus. We think Michigan National is on the right track," he added.
Keefe, Bruyette & Woods Inc. represented Michigan National as an investment banker in the sale. Associates Corp. of North America represented itself.
Michigan National stock gained 25 cents to close at $76.25 on Thursday.
