At least one winner emerged from the mortgage crisis. Donna DeMaio, chief executive officer of MetLife Bank, took advantage of rock-bottom prices to buy two mortgage companies last summer, and has since been busy turning the subsidiary of insurance giant MetLife Inc. into a serious lender.
"We used to be a little bank attached to a big insurer, and now we're a little bank with a big mortgage business," DeMaio says.
In fact, the acquisitions of First Horizon Home Loans and EverBank Reverse Mortgage catapulted the 7-year-old MetLife Bank from relative obscurity to the national stage. MetLife is now the eighth-largest mortgage provider and fourth-largest seller of reverse mortgages. Staff count has ballooned from a mere 85 to more than 3,000; asset size nearly doubled, to $15 billion, and net income in the second quarter of 2009 more than tripled, to $108 million, over the same period last year.
"As with any acquisition, you always have the integration to deal with in the first year, but it's gone as well as one could expect," says DeMaio, explaining that she spent much of the past year visiting branches and easing employees into the MetLife fold.
The refinance boom earlier this year helped get the bank off to a good start, with new loan originations in the first half of 2009 up 52 percent on the year to $20 billion. Because MetLife refused to take on old loans in both acquisitions, DeMaio has been working off of a clean balance sheet.
"In one respect it's like starting in the middle of the movie, but in another respect it's good because I don't have to deal with all the old problems," says DeMaio. "I get to look forward."
Not having any baggage is a big bonus considering the long road ahead: DeMaio says she plans to turn MetLife bank into one of the country's top-five mortgage providers.
Bill Wheeler, the chief financial officer at parent company MetLife Inc. says DeMaio's experience - she spent 18 years as a banking consultant at PricewaterhouseCoopers and a has degree in accounting - make her particularly adept at building a bank.
"In acquisitions, people sometimes get distracted by the stories and strategic considerations, when you should really be focused on the numbers," he says. "Because of her financial background and training, Donna has the discipline to focus on the numbers and make those a success."
Over the next 12 months, DeMaio has a simple list of priorities. First, she plans to review MetLife's product mix and pricing - making sure she's offering the right kinds of mortgages and any ancillary services that might be necessary, such as checking accounts. She also wants to improve cross-selling efforts, in particular helping parent company MetLife Inc. find new homeowners who might want to buy homeowner's insurance. To achieve growth, DeMaio wants to expand into all the major metropolitan areas, hire more salespeople, and even make more acquisitions.
"Now that the integration is coming to an end, we can breathe and see where we want to take the business," she says, pointing out that she wants to double loan volumes in the next five years. "I don't see us being a Wells Fargo or a Bank of America, but I want to be in the next group."