A plan to streamline Irwin Financial Corp. of Columbus, Ind., by selling off $1 billion of home equity loans has failed.
The $5.9 billion-asset company, which is working to restructure itself after heavy losses, said Wednesday that its deal to sell the loans and their servicing rights to Roosevelt Management Co. LLC in New York did not get the required approval from a third party.
A separate plan to work with Roosevelt to securitize $275 million of home equity loans is unaffected, Irwin said.
The company, which has been struggling to remain well capitalized, also said it intends to raise $50 million in a rights offering.
In another move to strengthen capital, Irwin said it is considering exchanging some outstanding trust-preferred securities for common stock.
"The new capital will provide additional protection from potential deterioration in our home equity and commercial real estate loan portfolios during this time of financial market and economic uncertainty," Irwin said.
It has lost money for six consecutive quarters, including $107 million, or $3.64 a share, in the second quarter.
Irwin's stock climbed 1.26% Wednesday, to $4.