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{{Short description|American regional bank of Southern California}} |
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{{Infobox company |
{{Infobox company |
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| name = OneWest Bank, N.A. |
| name = OneWest Bank, N.A. |
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| logo = |
| logo = OneWest Bank logo.png |
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| image = |
| image = |
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| type = [[Subsidiary]] |
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| type = [[Division (business)|Division]] of [[CIT Bank|CIT Bank, N.A.]] |
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| foundation = |
| foundation = {{Start date and age|2009|03|19}} |
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| defunct = {{End date and age|2022|07|15}} |
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| founders = [[Steven Mnuchin]]<br> {{small|(via IMB Holdco)}} |
| founders = [[Steven Mnuchin]]<br /> {{small|(via IMB Holdco)}} |
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| location_city = [[Pasadena, California]], [[United States| |
| location_city = [[Pasadena, California]], [[United States|U.S.]] |
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| industry = [[Banking]] |
| industry = [[Banking]] |
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| key_people = |
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| key_people = [[Ellen Alemany]]<br>{{small|(Chairwoman and CEO)}}<br>Robert Rubino<br>{{small|(President of CIT Bank)}} |
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| assets = |
| assets = |
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| parent = [[ |
| parent = [[First Citizens BancShares]] |
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| subsid = |
| subsid = |
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| |
| website = {{URL|https://www.firstcitizens.com}} |
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| predecessor = |
| predecessor = |
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| area_served = [[Southern California]] |
| area_served = [[Southern California]] |
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| products = |
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| owner = |
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| num_employees = |
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| num_employees_year = |
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| website = {{https://www.onewestbank.com|OneWest Bank}} |
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}} |
}} |
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| ⚫ | |||
| ⚫ | '''OneWest Bank''' is a former US [[regional bank]] that operated from March 2019 to July 2022, when it became a [[Division (business)|division]] of [[First Citizens BancShares]]. With over 60 retail branches in [[Southern California]]. OneWest Bank specialized in consumer deposit and lending. OneWest also offered small business services, loans, and treasury management products. |
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==History== |
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| ⚫ | '''OneWest Bank''', a [[Division (business)|division]] of [[ |
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| ⚫ | From 2008 to 2012, [[List of bank failures in the United States (2008–present)|465 banks]] failed in the United States following the [[financial crisis of 2007–2008]]. When the [[Federal Deposit Insurance Corporation]] (FDIC) closed the banks, their assets were sold.<ref name="FDIC2013">{{cite web|url=http://www.fdic.gov/bank/individual/failed/banklist.html |title=Failed Bank List |publisher=Federal Deposit Insurance Corporation |access-date=November 15, 2013 |archive-url=https://web.archive.org/web/20131115033731/http://www.fdic.gov/bank/individual/failed/banklist.html |archive-date=November 15, 2013 |url-status=live }}</ref> On March 19, 2009, a seven-member investor group, IMB Holdco, led by [[Steven Mnuchin]]—which included billionaires [[Christopher Flowers]], [[John Paulson]], [[Michael Dell]], and [[George Soros]]—purchased [[IndyMac|Independent National Mortgage Corporation]] (IndyMac Bank) of Pasadena, California for $13.65 billion from the FDIC and created OneWest, which then had 33 branches and $32 billion in assets.<ref name="WSJ_Wigand_20170119">{{cite news |url=https://www.wsj.com/articles/steven-mnuchin-bought-indymac-fair-and-square-1484784634 |title=Steven Mnuchin Bought IndyMac Fair and Square |quote=Trump’s pick for Treasury made the best offer. The second-highest bid meant $1 billion more in losses. |first1=Jim |last1=Wigand |first2=John |last2=Bovenzi |date=January 19, 2017 |access-date=December 23, 2018 |newspaper=Wall Street Journal}}</ref> IndyMac Bank's failure was the fourth largest in US history.<ref>{{cite news |first=Andrea |last=Shalal-Esa |title=Factbox: Top ten U.S. bank failures |url=https://www.reuters.com/article/ousivMolt/idUSTRE48P0YC20080926 |work=[[Reuters]] |publisher=[[Thomson Reuters]] |date=September 25, 2008|access-date=December 23, 2018 }}</ref> |
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| ⚫ | Through OneWest Bank the investment group purchased two other failed banks from the FDIC, the [[First Federal Bank of California]] on December 18, 2009, which then had $6 billion in assets and $5 billion in deposits, and La Jolla Bank, FSB in February 2010, which then represented $3.6 billion in assets. In November 2010, OneWest purchased a $1.4 billion multifamily and commercial real estate loan portfolio from [[Citibank]], which included approximately 600 loans, as part of their commercial real estate lending business.<ref>{{Cite news|url=https://www.housingwire.com/articles/onewest-buys-14-billion-cmbs-portfolio-citibank|title=OneWest buys $1.4 billion CMBS portfolio from Citibank|access-date=2018-11-20|language=en}}</ref> Under a [[Freedom of Information Act]] (FOIA) request, nonprofit California Reinvestment Coalition determined that as of December 2014, the FDIC had already paid over $1 billion to OneWest Bank under the shared loss agreements it secured from the FDIC when it purchased IndyMac and La Jolla Banks, and that the FDIC expected it would pay another $1.4 billion.<ref>{{Cite web|url=http://labusinessjournal.com/news/2014/dec/16/onewest-expected-receive-over-24-billion-fdic/|title=OneWest Expected to Receive Over $2.4 Billion From FDIC {{!}} Los Angeles Business Journal|website=labusinessjournal.com|date=16 December 2014|access-date=2019-05-31}}</ref> |
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It established on March 19, 2009 by IMB Holdco, a holding company owned by a consortium of private equity investors led by [[Steven Mnuchin]]. In August 2015, OneWest was acquired by [[CIT Group]].<ref name="businesswire.com">{{Cite news|url=http://www.businesswire.com/news/home/20150803005417/en/CIT-Completes-Acquisition-OneWest-Bank#.VcNlN_nLdYV|title=CIT Completes Acquisition of OneWest Bank|access-date=2018-11-20|language=en}}</ref> [[CIT Bank|CIT Bank, N.A.]] is the retail banking subsidiary of CIT Group and consists of OneWest Bank and an [[direct bank|online bank]]. |
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| ⚫ | The ''[[New York Daily News]]''<ref name="nydailynews_20161202">{{cite news |url=https://www.nydailynews.com/news/politics/trump-voter-upset-mnuchin-bank-foreclosed-home-article-1.2896583 |newspaper=[[New York Daily News]] via The Associated Press |title=Trump voter disappointed after Steve Mnuchin, whose bank foreclosed on her home, named Treasury Secretary |date=December 2, 2016 |access-date=December 23, 2018}}</ref> and the [[Wall Street Journal|''Wall Street Journal'']] reported that OneWest Bank had started foreclosure proceedings on 137,000 homeowners.<ref>{{Cite web|url=http://money.com/money/4639480/steve-mnuchin-treasury-secretary-foreclosures-onewest/|title=Here's Why Treasury Nominee Steve Mnuchin Has Been Called the 'Foreclosure King'|website=Money|language=en|access-date=2019-05-31}}</ref> |
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==Formation and early acquisitions== |
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On November 25, 2009, Judge Jeffrey Spinner in Long Island, New York, penalized OneWest for their “harsh, repugnant, shocking and repulsive” actions in trying to work out a distressed mortgage, by canceling the debt in favor of the borrower.<ref>{{cite news| url=http://www.nypost.com/p/news/local/judge_kos_mortgage_to_slap_bank_28ZS1oW8Y58z6gu1AQbWMI | work=New York Post | title=Judge blasts bad bank, erases 525G debt | first1=Kieran | last1=Crowley | first2=Rich | last2=Wilner | first3=Dan | last3=Mangan | date=2009-11-25}}</ref> A year later, an appellate court overruled that the decision.<ref>{{cite news| url=http://www.nypost.com/p/news/local/couple_foreclose_break_ko_hN8U3t9nn1CeTS5lRmwYZL#ixzz1CBhhquoN | work=New York Post | first1=Kieran | last1=Crowley | first2=Jeremy | last2=Olshan | title=Couple's foreclose break KO'd | date=November 23, 2010}}</ref> |
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| ⚫ | From 2008 to 2012 [[List of bank failures in the United States (2008–present)|465 banks]] failed in the United States following the [[financial crisis of 2007–2008]]. When the [[Federal Deposit Insurance Corporation]] (FDIC) closed the banks, their assets were sold.<ref name="FDIC2013">{{cite web|url=http://www.fdic.gov/bank/individual/failed/banklist.html |title=Failed Bank List |publisher=Federal Deposit Insurance Corporation | |
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| ⚫ | On December 8, 2009, OneWest worked with the [[Hennepin County]], [[Minnesota]] Sheriff's department to change the locks on a distressed home despite stating in a Nov. 25 e-mail that they were rescinding both the foreclosure and the sheriff's sale. Changing the locks was done without a court action, bypassing mandated [[due process]] on home foreclosures in Minnesota.<ref name="indy">{{Cite web |title=Leslie Parks Illegally Locked Out of Her Home by IndyMac/One West Bank | Twin Cities Indymedia | Movement Media for Minneapolis-St. Paul |url=http://twincities.indymedia.org/2009/dec/leslie-parks-illegally-locked-out-her-home-indymacone-west-bank#comment-9038 |url-status=dead |archive-url=https://web.archive.org/web/20091213193151/http://twincities.indymedia.org/2009/dec/leslie-parks-illegally-locked-out-her-home-indymacone-west-bank#comment-9038 |archive-date=2009-12-13 |access-date=2009-12-09}}</ref> |
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| ⚫ | Through OneWest Bank the investment group purchased two other failed banks from the FDIC, the [[First Federal Bank of California]] on December 18, 2009, which then had $6 billion in assets and $5 billion in deposits, and La Jolla Bank, FSB in February 2010, which then represented $3.6 billion in assets. In November 2010, OneWest |
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| ⚫ | OneWest Bank stopped originating reverse mortgages before CIT acquired the bank. However, it continued servicing its portfolio of reverse mortgages, and was criticized for abusive foreclosure practices.<ref>{{Cite web |url=https://www.politico.com/story/2016/12/trump-treasury-foreclosed-homes-mnuchin-232038 |title=Trump Treasury pick made millions after his bank foreclosed on homeowners |last=Woellert |first=Lorraine |website=[[Politico]] |date=December 2016}}</ref> In May 2017, CIT agreed to pay $89 million in settlement claims related to OneWest's reverse mortgage program.<ref>{{Cite news |url=https://www.nbcnews.com/news/us-news/mnuchin-s-former-bank-pays-89-million-settle-mortgage-claims-n760581 |title=Steve Mnuchin's Former Bank To Pay $89 Million Settlement to U.S. |work=[[NBC News]] | date=May 2017}}</ref> According to the [[United States Department of Justice]], "The United States alleged that Financial Freedom sought to obtain insurance payments for interest from FHA despite failing to disclose on the insurance claim properly forms it filed with the agency that the mortgagee was not eligible for such interest payments because it had failed to meet various deadlines relating to appraisal of the property, submission of claims to HUD, and pursuit of foreclosure proceedings. As a result, from March 31, 2011 to August 31, 2016, the mortgagees on the relevant reverse mortgage loans serviced by Financial Freedom allegedly obtained additional interest they were not entitled to receive."<ref>{{Cite press release |url=https://www.justice.gov/opa/pr/financial-freedom-settles-alleged-liability-servicing-federally-insured-reverse-mortgage |title=Financial Freedom Settles Alleged Liability for Servicing of Federally Insured Reverse Mortgage Loans for $89 Million | publisher=[[United States Department of Justice]] |date=May 16, 2017}}</ref> |
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==Controversial foreclosures on IndyMac loans== |
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In July 2014, OneWest Bank and [[CIT Group]] announced a merger. CIT Group had accepted $2.3 billion in [[Troubled Asset Relief Program]] funding that it never repaid, because it declared bankruptcy.<ref>{{Cite news |url=https://www.latimes.com/business/la-fi-onewest-cit-protest-20141216-story.html |title=Advocacy group protests CIT Group deal for OneWest Bank |first=E. Scott | last=Reckard |website=[[Los Angeles Times]] |date=16 December 2014 | url-access=limited}}</ref> Nonprofits raised concerns about the merger, citing the damage caused by OneWest's approximately 36,000 foreclosures in California, the bank's weak record in small business lending, weak [[Community Reinvestment Act]] record, and concerns about possible [[redlining]]. On February 2, 2015, [[Daily Kos]] and the California Reinvestment Coalition delivered more than 15,000 signatures on petitions opposing the merger.<ref>{{Cite news |url=https://www.dailykos.com/story/2015/2/3/1362044/-Daily-Kos-and-partners-deliver-15-000-petitions-to-Federal-Reserve-Stop-these-bank-mergers |title=Daily Kos and partners deliver 15,000+ petitions to Federal Reserve: Stop these bank mergers | website=[[Daily Kos]] | date=February 3, 2015}}</ref> |
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In enforcing its rights under the loans purchased from IndyMac, OneWest Bank took a much more aggressive approach to foreclosing on properties. |
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On August 3, 2015, [[CIT Group]] acquired OneWest Bank, N.A.<ref name="LATimes_Peltz_20150803">{{cite news |url=https://www.latimes.com/business/la-fi-onewest-cit-20150804-story.html |work=[[Los Angeles Times]] |title=CIT Group closes $3.4-billion purchase of OneWest Bank in Pasadena |first=James F. |last=Peltz |date=August 3, 2015 |url-access=limited}}</ref> In January 2022, CIT was acquired by [[First Citizens BancShares]].<ref>{{Cite press release |url=https://www.prnewswire.com/news-releases/first-citizens-completes-merger-with-cit-group-301453104.html |title=First Citizens Completes Merger With CIT Group |publisher=[[PR Newswire]] |date=January 4, 2022}}</ref><ref>{{Cite news |last=McCaffrey |first=Orla |date=16 October 2020 |title=First Citizens to Buy CIT Group |url=https://www.wsj.com/articles/first-citizens-cit-group-to-merge-11602854037 |access-date=15 July 2024 |work=[[The Wall Street Journal]]}}</ref> |
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According to the ''Wall Street Journal'', OneWest Bank attempted to foreclose on the home of Diana Yano-Horoski and her husband. They spent years fighting the foreclosure in court.<ref name="WSJ_Ensign_20170119"/> |
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On November 25, 2009, Judge Spinner in Long Island, New York penalized OneWest for their “harsh, repugnant, shocking and repulsive” actions in trying to work out a distressed mortgage, by canceling the debt in favor of the borrower.<ref>{{cite news| url=http://www.nypost.com/p/news/local/judge_kos_mortgage_to_slap_bank_28ZS1oW8Y58z6gu1AQbWMI | work=New York Post | title=Judge blasts bad bank, erases 525G debt | first1=Kieran | last1=Crowley | first2=Rich | last2=Wilner | first3=Dan | last3=Mangan | date=2009-11-25}}</ref> A year after the New York Judge Spinner wiped away the debt, an appellate panel ruled that the judge had no right to do it. While Judge Spinner ruled that the bank's practices warranted him erasing the homeowners' debt, the appellate judges found that he had no authority to render such a judgment—and did not give the bank fair notice that such consequences were even on the table.<ref>{{cite news| url=http://www.nypost.com/p/news/local/couple_foreclose_break_ko_hN8U3t9nn1CeTS5lRmwYZL#ixzz1CBhhquoN | work=New York Post | first1=Kieran | last1=Crowley | first2=Jeremy | last2=Olshan | title=Couple's foreclose break KO'd | date=November 23, 2010}}</ref> After the ruling, in a previously unreported twist, senior OneWest executives reviewing the bank's past-due mortgages came across a delinquent loan made to the judge, a person familiar with the matter said. The bank asked the judge to recuse himself. He did. Judge Spinner said Wednesday that while he fell behind on his mortgage, this had no bearing on his decision in the Horoskis’ case. After Judge Spinner recused himself, a higher court overturned his decision canceling the Horoskis’ loan. The Horoskis’ home was foreclosed on in 2012 and later sold by the bank. OneWest, now owned by CIT Group Inc., is still trying to get more than $400,000 from Mrs. Yano-Horoski, she said.<ref name="WSJ_Ensign_20170119">{{cite news |url=https://www.wsj.com/articles/mnuchins-bank-foreclosed-on-this-couple-now-they-support-trump-1484821802?mod=e2fb |title=Mnuchin’s Bank Foreclosed on This Couple. Now They Support Trump |quote=The Horoskis of Long Island, NY, say their foreclosure experience with OneWest Bank gave them a more conservative worldview |first=Rachel Louise |last=Ensign |date=January 19, 2017 |access-date=December 23, 2018 |newspaper=Wall Street Journal}}</ref> |
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| ⚫ | On December 8, 2009 OneWest worked with the [[Hennepin County]], [[Minnesota]] Sheriff's department to change the locks on a distressed home despite stating in a Nov. 25 e-mail that they were rescinding both the foreclosure and the |
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| ⚫ | OneWest Bank stopped originating reverse mortgages |
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==OneWest sold by Mnuchin investor group, 2015== |
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In July 2014, OneWest Bank and CIT Group announced that they were planning to merge. CIT Group was a bank that accepted $2.3 billion in TARP funding that it never repaid because it declared bankruptcy.<ref>{{Cite web|url=https://www.latimes.com/business/la-fi-onewest-cit-protest-20141216-story.html|title=Advocacy group protests CIT Group deal for OneWest Bank|last=Reckard|first=E. Scott Reckard, By E. Scott|website=latimes.com|access-date=2019-05-31}}</ref> Nonprofits throughout the state very quickly raised concerns about the merger, citing the damage caused by the approximately 36,000 foreclosures conducted by OneWest in California, the bank's weak record in small business lending, the bank's weak community reinvestment act record, and concerns about possible redlining by the bank.<ref>California Reinvestment Coalition letter to bank regulators about proposed OneWest and CIT Group merger.</ref> As more people learned about the proposed merger, more people opposed it. On February 2, 2015, Daily Kos and the California Reinvestment Coalition visited the San Francisco Federal Reserve and delivered more than 15,000 petitions signed by people who opposed the merger.<ref>{{Cite web|url=https://www.dailykos.com/story/2015/2/3/1362044/-Daily-Kos-and-partners-deliver-15-000-petitions-to-Federal-Reserve-Stop-these-bank-mergers|title=Daily Kos and partners deliver 15,000+ petitions to Federal Reserve: Stop these bank mergers|website=Daily Kos|access-date=2019-05-31}}</ref> A picture of those petitions being delivered was included in Al Gore's most recent book. Then, in recognition of the strong opposition to the merger, bank regulators announced on February 6, 2015, that they would hold a public hearing about the proposed merger.<ref>{{Cite web|url=https://labusinessjournal.com/news/2015/feb/06/regulators-hold-hearing-cit-onewest-deal/|title=Regulators to Hold Hearing on CIT-OneWest Deal {{!}} Los Angeles Business Journal|website=labusinessjournal.com|access-date=2019-05-31}}</ref> Regulators rarely hold public hearings about proposed bank mergers. In August 2015 the Mnuchin investor group sold OneWest to the New York-based [[CIT Group]].<ref name="LATimes_Peltz_20150803">{{cite news| work=[[Los Angeles Times]] | title=CIT Group closes $3.4-billion purchase of OneWest Bank in Pasadena |first=James F. |last=Peltz |date=August 3, 2015 | access-date=December 23, 2018 |url=https://www.latimes.com/business/la-fi-onewest-cit-20150804-story.html}}</ref> |
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===Financial Freedom=== |
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OneWest's "[[reverse mortgage]] servicing business", Financial Freedom, was part of CIT's acquisition but was "reported in CIT's discontinued operations". In 2017, The reverse mortgage portfolio is reported as part of the company's continuing operations.<ref name="prnewswire_CIT_20171006">{{cite web |url=https://www.prnewswire.com/news-releases/cit-reaches-agreement-to-sell-financial-freedom-and-reverse-mortgage-portfolio-300532738.html |title=CIT Reaches Agreement to Sell Financial Freedom and Reverse Mortgage Portfolio |work=PRS newswire via CIT Group Inc |date=October 6, 2017 |access-date=December 24, 2018}}</ref> In 2017, CIT Group sold Financial Freedom—which includes "its reverse mortgage portfolio"—c.$900 million of "reverse mortgage whole loans" and other "real estate owned assets", to an "undisclosed buyer".<ref name="prnewswire_CIT_20171006"/> |
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==Programs== |
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On October 4, 2010 OneWest Bank implemented the Principal Reduction Alternative (PRA) loan modification program as outlined under the [[Home Affordable Modification Program|Home Affordable Modification Program (HAMP)]]. The program aimed to help struggling homeowners by modifying their loans and reducing their monthly mortgage payments. With this announcement, OneWest became one of the first servicers to launch the program. |
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On August 3, 2015, [[CIT Bank]], the U.S. commercial subsidiary of CIT Group Inc., was combined with OneWest Bank, N.A., under the charter of the latter. The resulting financial institution became known as [[CIT Bank|CIT Bank, N.A.]]<ref name="businesswire.com" /> |
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CIT published a four-year Community Reinvestment Act Plan on October 19, 2015 targeting $5 Billion in new lending and investing activities by December 31, 2019. Efforts focus on financial and personal empowerment through affordable housing, single family and multifamily lending, small business lending, economic development, financial education and other outreach activities with the local community.<ref>{{Cite web|url=https://www.cit.com/uploadedFiles/citcom/contents/about_us/us/social_responsibility/charitable_giving/CIT_Bank_CRA_Plan.pdf|title=CIT CRA Plan}}</ref> |
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== Sale of Financial Freedom and Reverse Mortgage Portfolio == |
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In October 2017, CIT announced the sale of Financial Freedom, the unit of OneWest Bank that was responsible for servicing reverse mortgages. On June 4, 2018 CIT completed the sale of the Financial Freedom reverse mortgage servicing business and the related reverse mortgage portfolio to an undisclosed buyer. The transaction included the sale of mortgage servicing rights and $879 million of reverse mortgage whole loans and other real estate owned assets as of April 30, 2018. |
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"These efforts support our plan to simplify CIT and gain greater efficiency in our business," said Chairwoman and Chief Executive Officer of CIT Ellen R. Alemany in a press release. "We have addressed another legacy issue by exiting the reverse mortgage business, and we have created greater efficiency in our ongoing mortgage operation by partnering with an industry leader to service our portfolio.”<ref>{{Cite news|url=http://cit.mediaroom.com/2018-06-04-CIT-Completed-Initiatives-to-Simplify-Mortgage-Operations|title=CIT Completed Initiatives to Simplify Mortgage Operations|work=CIT Press Releases|access-date=2018-11-20|language=en}}</ref> |
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==See also== |
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*[[CIT Bank]] |
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*[[CIT Group]] |
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*[[2008 United States bank failures]] |
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*[[Subprime mortgage crisis]] |
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==References== |
==References== |
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{{Reflist}} |
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{{reflist|group="Notes"}} |
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==References== |
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{{reflist|30}} |
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==External links== |
==External links== |
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* |
* {{Official website|https://www.onewestbank.com/}} |
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{{50 largest US banks}} |
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{{DEFAULTSORT:Onewest Bank}} |
{{DEFAULTSORT:Onewest Bank}} |
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[[Category:2009 establishments in California]] |
[[Category:2009 establishments in California]] |
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[[Category:2015 mergers and acquisitions]] |
[[Category:2015 mergers and acquisitions]] |
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[[Category:2022 disestablishments in California]] |
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[[Category:American companies established in 2009]] |
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[[Category:Banks based in California]] |
[[Category:Banks based in California]] |
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[[Category:Banks disestablished in 2022]] |
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[[Category:Companies based in Pasadena, California]] |
[[Category:Companies based in Pasadena, California]] |
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[[Category:Mortgage lenders of the United States]] |
[[Category:Mortgage lenders of the United States]] |
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Latest revision as of 20:25, 24 November 2024
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| Company type | Subsidiary |
|---|---|
| Industry | Banking |
| Founded | March 19, 2009 |
| Founders | Steven Mnuchin (via IMB Holdco) |
| Defunct | July 15, 2022 |
| Headquarters | |
Area served | Southern California |
| Parent | First Citizens BancShares |
| Website | www |
OneWest Bank is a former US regional bank that operated from March 2019 to July 2022, when it became a division of First Citizens BancShares. With over 60 retail branches in Southern California. OneWest Bank specialized in consumer deposit and lending. OneWest also offered small business services, loans, and treasury management products.
History
[edit]From 2008 to 2012, 465 banks failed in the United States following the financial crisis of 2007–2008. When the Federal Deposit Insurance Corporation (FDIC) closed the banks, their assets were sold.[1] On March 19, 2009, a seven-member investor group, IMB Holdco, led by Steven Mnuchin—which included billionaires Christopher Flowers, John Paulson, Michael Dell, and George Soros—purchased Independent National Mortgage Corporation (IndyMac Bank) of Pasadena, California for $13.65 billion from the FDIC and created OneWest, which then had 33 branches and $32 billion in assets.[2] IndyMac Bank's failure was the fourth largest in US history.[3]
Through OneWest Bank the investment group purchased two other failed banks from the FDIC, the First Federal Bank of California on December 18, 2009, which then had $6 billion in assets and $5 billion in deposits, and La Jolla Bank, FSB in February 2010, which then represented $3.6 billion in assets. In November 2010, OneWest purchased a $1.4 billion multifamily and commercial real estate loan portfolio from Citibank, which included approximately 600 loans, as part of their commercial real estate lending business.[4] Under a Freedom of Information Act (FOIA) request, nonprofit California Reinvestment Coalition determined that as of December 2014, the FDIC had already paid over $1 billion to OneWest Bank under the shared loss agreements it secured from the FDIC when it purchased IndyMac and La Jolla Banks, and that the FDIC expected it would pay another $1.4 billion.[5]
The New York Daily News[6] and the Wall Street Journal reported that OneWest Bank had started foreclosure proceedings on 137,000 homeowners.[7]
On November 25, 2009, Judge Jeffrey Spinner in Long Island, New York, penalized OneWest for their “harsh, repugnant, shocking and repulsive” actions in trying to work out a distressed mortgage, by canceling the debt in favor of the borrower.[8] A year later, an appellate court overruled that the decision.[9]
On December 8, 2009, OneWest worked with the Hennepin County, Minnesota Sheriff's department to change the locks on a distressed home despite stating in a Nov. 25 e-mail that they were rescinding both the foreclosure and the sheriff's sale. Changing the locks was done without a court action, bypassing mandated due process on home foreclosures in Minnesota.[10]
OneWest Bank stopped originating reverse mortgages before CIT acquired the bank. However, it continued servicing its portfolio of reverse mortgages, and was criticized for abusive foreclosure practices.[11] In May 2017, CIT agreed to pay $89 million in settlement claims related to OneWest's reverse mortgage program.[12] According to the United States Department of Justice, "The United States alleged that Financial Freedom sought to obtain insurance payments for interest from FHA despite failing to disclose on the insurance claim properly forms it filed with the agency that the mortgagee was not eligible for such interest payments because it had failed to meet various deadlines relating to appraisal of the property, submission of claims to HUD, and pursuit of foreclosure proceedings. As a result, from March 31, 2011 to August 31, 2016, the mortgagees on the relevant reverse mortgage loans serviced by Financial Freedom allegedly obtained additional interest they were not entitled to receive."[13]
In July 2014, OneWest Bank and CIT Group announced a merger. CIT Group had accepted $2.3 billion in Troubled Asset Relief Program funding that it never repaid, because it declared bankruptcy.[14] Nonprofits raised concerns about the merger, citing the damage caused by OneWest's approximately 36,000 foreclosures in California, the bank's weak record in small business lending, weak Community Reinvestment Act record, and concerns about possible redlining. On February 2, 2015, Daily Kos and the California Reinvestment Coalition delivered more than 15,000 signatures on petitions opposing the merger.[15]
On August 3, 2015, CIT Group acquired OneWest Bank, N.A.[16] In January 2022, CIT was acquired by First Citizens BancShares.[17][18]
References
[edit]- ^ "Failed Bank List". Federal Deposit Insurance Corporation. Archived from the original on November 15, 2013. Retrieved November 15, 2013.
- ^ Wigand, Jim; Bovenzi, John (January 19, 2017). "Steven Mnuchin Bought IndyMac Fair and Square". Wall Street Journal. Retrieved December 23, 2018.
Trump's pick for Treasury made the best offer. The second-highest bid meant $1 billion more in losses.
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