Wells Fargo Buys $6 Billion Loan Portfolio From Struggling Euro Bank
Wells Fargo announced on Monday that they are picking up a $6 billion loan portfolio from a struggling European bank, WestLB.
This is not the first time the San-Francisco based bank has picked up portfolios from struggling Euro banks, as the bank picked up a huge $9.5 billion energy portfolio from BNP Paribas in February, according to Forbes.
Yahoo Finance reports that Julie Caperton, head of Asset-Backed Finance and Security, stated:
“We have been growing our subscription finance business organically for many years. This acquisition enhances our position in the marketplace and provides our clients with dedicated customer service as well as Wells Fargo’s strength, stability and broad product set.”
Forbes reports that WestLB is a German bank, and has been under pressure to shrink its business and sell assets, in order to receive billions of euros in state aid. BNP, based in France, had been searching for a way to downsize balance sheets, because of the ongoing European debt crisis.
KBW analyst Brian Kleinhanzl stated, “This is what Wells Fargo has been targeting for a while now–buying European assets as much as possible when it makes sense.”
According to Yahoo Finance, Mary Katherine DuBose, head of Corporate Debt Finance, stated:
“Subscription finance clients include some of the industry’s strongest fund managers who have commitments from high quality institutional investors. In addition to continuing to provide subscription finance services to these clients, we look forward to being able to offer them our full suite of banking products and services.”
The transaction between Wells Fargo and WestLB is expected to close by the end of the second quarter 2012.