Truist Cuts Jobs and Exits Auto-Finance Business
Truist Financial is exiting its auto-finance business by selling a $5.5 billion near-prime loan portfolio, leading to the closure of an Arlington, Texas facility and job losses for approximately 205 employees. The move aligns with Truist's strategy to focus on more profitable areas while reducing exposure in consumer lending segments it deems less strategic. The sale is expected to generate $5.2 billion in net proceeds along with a recapture of $535 million in loan-loss reserves, and will free up capital by creating around $945 million in common equity tier 1 capital. The transaction also aims to reduce nonperforming loans and annualized charge-offs. This decision follows Truist's earlier reductions in marine and recreational vehicle lending as part of a broader strategic shift under new CEO Mike Lyons, who took over on September 1.
Tickers: $TFC
Topics: Auto Finance Banking Job Cuts M&A