Investors led by Steven Mnuchin, a former Goldman Sachs Group Inc. executive, agreed to buy IndyMac Bank from the Federal Deposit Insurance Corp. and inject $1.3 billion in cash, a rare sale of a failed lender to non-bank buyers, Bloomberg reported.
The sale to a group of firms run by ex-Goldman bankers as well as hedge-fund managers John Paulson and George Soros was the least costly option, the FDIC said in a statement today. The FDIC agreed to share losses with the group on a pool of IndyMac loans.
The FDIC, which seized the institution in July after a bank run, was forced to open bidding to non-bank investors after failing to find a buyer among the lender's stronger rivals. The current market for selling assets is "challenging," the agency said in the statement. Regulators closed 25 banks last year.
"I am not impressed with the amount of capital being put in," Bert Ely, chief executive officer of Ely & Co. Inc., a financial institutions consultant in Alexandria, Virginia, said in an interview today. "Why didn't any bank buy it? IndyMac doesn't strike me as a very viable bank."
The investor group and the FDIC signed a letter of intent for the transaction, which the agency said in a fact sheet was valued at about $13.9 billion. The investors will inject about $1.3 billion in cash into the new company when the deal closes, later this month or in early February, the agency said.
The FDIC agreed to share some losses on a portfolio of loans, with the new company assuming the first 20 percent, the agency said.
FDIC spokesman David Barr declined to comment beyond the statement.
