Keycorp said Tuesday it agreed to acquire AutoFinance Group Inc. for $325 million, marking the bank company's first entry into the profitable but somewhat risky business of "sub-prime" auto lending.

Cleveland-based Keycorp, paying a hefty 3.8 times book value, said the acquisition would dilute its earnings by less than 1% while allowing it to offer "a complete spectrum of financing options to dealers across the country."

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