Flagstar Bancorp Inc. of Troy, Mich., is reportedly hoping to raise $600 million in capital through its majority owner, MatlinPatterson Global Advisors.
MatlinPatterson, a New York-based investment firm, has been in talks with private-equity firms to buy an equity stake in Flagstar, Bloomberg News reported late Tuesday. The $13.7 billion-asset Flagstar also may sell shares to existing investors after posting eight consecutive quarterly losses. A representative of the bank did not return a phone call seeking comment Wednesday.
Flagstar, the parent company of Flagstar Bank, has been on a recapitalization rampage since 2009, when MatlinPatterson invested $350 million into the company. Most recently, Flagstar raised $276.1 million in March through a common stock offering.
The company is exceedingly well capitalized with a total risk-based capital ratio of 17.20% as of June 30. It posted a $97 million net loss in the second quarter.
Flagstar reaffirmed its 2010 outlook Wednesday, without addressing potential capital-raising efforts. It said it expects to close 2010 with assets of $13 billion to $14 billion; loan sales of $22 billion to $26 billion; and a provision expense between $200 million and $250 million. Flagstar's shares fell 10.4% to close at $1.90 Wednesday.