OneWest in California Met with Suitors, Considers IPO: Report

OneWest Bank in Pasadena, Calif., which has been considering a sale or an initial public offering, has been meeting with potential merger partners, according to a report.

New York Community Bancorp (NYCB) in Westbury, N.Y., is the most serious suitor for the $26 billion-asset OneWest, Reuters reported Thursday. OneWest held preliminary discussions with several banks, though New York Community is the only ongoing suitor, unnamed sources told Reuters.

However, the $41 billion-asset New York Community has reservations due to the quality of OneWest’s mortgage portfolio and because it has not historically been a mortgage servicer, the report said. OneWest has nearly $3.3 billion in loans that are 90 or more days past due and $161 million in nonaccrual loans, according to data from the Federal Deposit Insurance Corp. It is one of three banks continuing the foreclosure-review process that regulators ended with a settlement in January.

OneWest has also been exploring the possibility of conducting an IPO, and hopes for an upside of 20% to 80%, according to a year-end letter to investors obtained by Reuters. The second-largest privately held bank in the country, OneWest is owned by a group of investors that includes funds managed by George Soros and John Paulson.