Capital City in Florida to buy majority stake in mortgage lender
Capital City Bank Group in Tallahassee, Fla., has agreed to buy a majority stake in BrandMortgage in Lawrenceville, Ga.
The $2.9 billion-asset Capital City said in a press release Wednesday that it will buy a 51% stake in the mortgage lender. Capital City did not disclose the price it will pay.
The deal is expected to close in the first quarter.
Greg Shumate, BrandMortgage’s CEO and managing partner, will become an officer at Capital City Bank. Shumate and BrandMortgage President Alex Koutouzis will continue to lead the business as an independent operation.
BrandMortgage's 21 offices will be added to the 57 branches operated by Capital City. The mortgage company will remain headquartered in Lawrenceville.
Increased refinancing activity and higher volumes of home-loan production, spurred by lower interest rates, have made mortgages more attractive to banks.
If BrandMortgage's originations had been added to City Capital’s in 2019, it would have tripled the bank's historical level of production, the release said.
Home-loan production levels in the banking industry have been about 23% higher on an annual basis in 2019 from a year earlier, according the Mortgage Bankers Association. Originations are expected to remain historically strong but drop by 8% year over year in 2020.
BrandMortgage was part of Brand Group Holding before the company's 2018 sale to Renasant. Renasant had required the Atlanta company to divest the mortgage unit.