MetLife Inc. took a step closer to exiting the banking business Tuesday by announcing that it is selling the bulk of its deposits to GE Capital Finance Inc.
The insurance giant said in a news release that GE Capital intends to buy about $7.5 billion of its roughly $10.7 billion of deposits, which consist of mostly of certificates of deposits and money-market funds. The deal does not include about $3 billion in custodial deposits associated with MetLife's mortgage business and certain other deposits that MetLife said would be transferred out of its MetLife Bank over the next six months. The companies did not disclose a sale price.
MetLife has been looking for a buyer for its depository since July when it announced that it was abandoning its charter due to the increased costs and demands of complying with federal regulations. The company had initially intended to retain the mortgage business it acquired from First Horizon National Corp. several years ago, but then said in October that it planned to exit that business as well.
MetLife has been offering retail banking products via the Internet since 2001. Steven A. Kandarian, the president and chief executive of MetLife Inc., said that the sale of the deposits to GE Capital — which also collects deposits via the Internet — "ensures that customers of MetLife Bank will continue to be served by a high-quality organization that already meets the financing needs of more than 100 million customers. At the same time," he added," this agreement is a significant step toward MetLife's no longer being a bank holding company."
The sale is expected to close in the second quarter.