MetLife continues mortgage exit
MetLife Inc. has announced that it is leaving the reverse mortgage business and selling their servicing portfolio to Nationstar Mortgage LLC, according to National Mortgage Professional magazine. The transaction is subject to regulatory approvals and standard closing conditions, but as of the announcement, MetLife Bank will no longer accept any new reverse mortgage loan applications and registrations.
This move is part of a series of strategic changes that put the company’s focus squarely on their core as a global insurance and employee benefits company, as the company decided in 2011 that a bank holding company structure was no longer appropriate. Since that decision, MetLife has reached agreements to sell their bank’s deposit business to GE Capital and sell the bank’s warehouse finance business to EverBank.
The company points to a board decision as to the restructure, but last summer, we reported that the bank was facing scrutiny from the Federal Reserve Board and regulations like the Dodd-Frank act, and made the decision to sell their bank assets totaling $15.6 billion with $9.3 million in deposits.
After last summer’s announcement that the bank was closing, and now the reverse mortgage business selling, it is clear that MetLife is true to their word of scaling back all banking activity, regardless of the inspiration, and focusing on insurance and benefits.
Other companies that branched out in the past are following suit, not by closing down, but by selling off their portfolios to focus on their non-banking competencies, as banking is not exactly an attractive industry to be in, with the billions of dollars in lawsuits, the federal scrutiny, the state agency investigations, and the bad press. It is unclear which companies are next in the line of sell-offs, but MetLife has definitely stood by their statement that they would focus on what they do best.