(Reuters) – Regional lender New York Community Bancorp said on Monday it has closed the sale of about $5.9 billion in deposit mortgage loans to Wall Street giant JPMorgan Chase.
The bank said it expects to close an additional $200 million in deposit mortgage loans in the near future, once the necessary customer approvals are received.
The deal bolsters NYCB’s liquidity and capital as the lender executes a crucial turnaround to return to profitability over the next two years.
In May, the bank announced that it had agreed to sell about $5 billion in deposit mortgage loans to JPMorgan.
Warehouse loans are lines of credit given to lenders who can use the funds to provide mortgages. They are repaid when the mortgage lender sells the loans to an investor.
The loans were sold to JPMorgan Chase at face value, NYCB said.
The deal upon closing is expected to add about 70 basis points to NYCB’s CET1 capital ratio.
(Reporting by Arasu Kannagi Basil in Bengaluru; Editing by Alan Barona)
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