US insurer MetLife Inc (NYSE:MET) said it had inked an accord to sell the mortgage servicing portfolio of its banking unit MetLife Bank NA to JPMorganChase Bank NA, part of financial major JPMorgan Chase & Company (NYSE:JPM).
MetLife did not reveal the terms of the deal, which has yet to receive regulatory clearance. The portfolio under the scope of the transaction stands at some USD70bn (EUR54.6bn).
On 24 October, in a regulatory filing, the insurer said it was pondering an offload of its mortgage servicing portfolio. MetLife decided last year that a banking holding company structure was no longer appropriate, in view of its strategic focus on insurance and employee benefits, and has since sealed deals to offload certain operations of the bank and discontinued writing residential mortgages. The firm’s entire retail banking operations, including mortgages, accounted for less than 2% of its overall operating earnings in 2011.
JPMorgan’s purchase of the portfolio is in line with its plan to beef up and expand its servicing business. As a result of the acquisition, the buyer will boosts its USD1.1trn servicing operations by over 5% and it will also be able to provide solutions to a further 350,000 clients.
MetLife hired K&L Gates LLP, Milestone Advisors LLC and Deutsche Bank Securities Inc as advisors on the deal.