Banks Merge

Provident Bankshares Corp. sold $183 million of mortgage-backed securities, a major step “to accelerate our strategy to transition the wholesale balance sheet” that is consistent with the company’s previously announced plans, according to an announcement.

While the restructuring will improve future financial performance and reduce the level of lower yielding wholesale assets and higher rate wholesale liabilities, it is projected to result in a $5 million charge to fourth quarter earnings, Provident said.

The launch of LeadQual LLC was announced on Thursday. The company began serving mortgage companies in July and has reportedly experienced over 50 percent month-over-month growth.

“Our average response time to our clients’ leads is currently three minutes and twenty-four seconds, and many are responded to in less than one minute, which is substantially faster than the many companies we researched,” Houck said in the announcement. “This is critically important since the average online consumer completes three lead forms and chooses the first agent who contacts him.”

Citizens Banking Corp. said on Thursday it closer to closing on an acquisition, as its shareholders and those of Republic Bancorp Inc. approved the merger of the two companies. The transaction, expected to close this month, will create Citizens Republic Bancorp and make the combined entity the 45th largest bank holding company in the country.

On Friday, Sterling Financial Corp. said it finished acquiring FirstBank NW Corp., a deal that strengthens Sterling’s community banking role in the West.

Also on Friday, National City Corp. announced it completed buying Harbor Florida Bancshares Inc. and will complete converting Harbors systems into its own in March, at which time the branches of subsidiary Harbor Federal Savings Bank will begin operating under the National City name.

Separately, National City expects to also complete its pending acquisition of Florida-based Fidelity Bankshares Inc. next month, according to the announcement.

Allied Home Mortgage Capital Corp. opened a branch in Grand Rapids, Mich., and stepped into new territory through a new branch in Lawrenceburg, Ind., according to announcements Thursday. The two new offices reportedly push to 53 the number of branches opened this year by Allied, the self-described “largest privately held mortgage banker/broker in the U.S.”

NovaStar Mortgage Inc. completed acquiring 19 retail mortgage lending locations and certain other assets of Oak Street Mortgage LLC. NovaStar’s retail presence expansion is expected to increase loan production initially by about $75 million to $100 million per month, according to a press release.

“In addition, this cost-effective operation should help further reduce our costs of loan origination,” said NovaStar Mortgage Chairman Lance Anderson in the written statement.

General Motors Corp. announced it has completed selling a 51-percent interest in GMAC to a consortium of investors led by Cerberus FIM Investors LLC and including subsidiaries of Citigroup Inc., Aozora Bank Ltd. and The PNC Financial Services Group Inc. The transaction, which began in April, will give GM $14 billion over the next three years.

“This transaction will result in a stronger GMAC, with enhanced access to funding at lower costs and greater opportunities for growth, including leveraging their traditionally strong relationships with GM dealers,” GM Chairman and Chief Executive Officer Rick Wagoner said in the written statement. “Although GMAC will have a new majority owner, GM and GMAC will remain strategic partners through various long-term agreements.”

The mortgage market has a new wholesale reverse mortgage lender.

Pacific Community Mortgage Inc. launched last week, company sales manager Cliff Auerswald told MortgageDaily.com. While Pacific has been in the A and Alt-A business for over 10 years, it officially stepped into the wholesale reverse lending arena on Friday and currently offers FHA’s Home Equity Conversion Mortgage but will launch a proprietary reverse mortgage product in the next few months, he said.

On Tuesday, the Hispanic National Mortgage Association and Deutsche Bank announced a new national correspondent lending operation, HNMA Funding Co., which offers innovative loan programs for Hispanic and other immigrant borrowers.

The San Diego, Calif.-based joint venture has already begun purchasing closed loans from mortgage lenders, community banks and credit unions on a mini-bulk or bulk basis. The liquidity provided by HNMA Funding will enable lenders to make low down-payment loans to borrowers who lack traditional credit and enable them to offer competitive interest rates significantly lower than the subprime rates that a large portion of Hispanic borrowers have historically been offered, according to the announcement.

MortgageIT Holdings Inc. announced that its shareholders on Thursday approved for the company to be acquired by Deutsche Bank in an all cash transaction expected to close next month.

Morgan Stanley reported today it completed its acquisition of Saxon Capital Inc. Shareholders of Saxon will receive $14.10 in cash for each share owned.

The Bank of New York Company Inc. and Mellon Financial Corp. have agreed to merge, the companies announced today. The transaction was unanimously approved by both board of directors and is expected to be done by the third quarter of 2007.

The Bank of New York Mellon Corp., to be headquartered in New York, will have $16.6 trillion in assets under custody and $8 trillion in assets under corporate trusteeship — making it “the world’s leading asset servicer,” according to the announcement.

Current Bank of New York Chairman Thomas A. Renyi will serve as executive chairman of the combined entity for 18 months, the statement said. He will be succeeded by current Mellon Chairman and CEO Robert P. Kelly, who has been named CEO of the new 40,000-employee entity.