OneWest Bank to Merge into CIT Bank

The parent of CIT Bank recently announced it has entered into an agreement to buy OneWest Bank. According to CIT’s press release:

Following the close of the transaction, CIT Bank, CIT’s banking subsidiary, will merge with OneWest Bank under the "CIT Bank" name and CIT will have assets of $67 billion and $28 billion in deposits.

OneWest assumed all deposits of IndyMac Bank in 2009 after IndyMac failed in 2008. When IndyMac failed in July 2008, the FDIC took over as conservator of the bank. The FDIC managed the bank until it was sold to OneWest in 2009. OneWest Bank was formed by investors for the purpose of acquiring IndyMac.

According to this LA Times article:

The acquisition of OneWest, announced Tuesday, also would mark a big payday for billionaire investors who put up $1.5 billion five years ago to buy much of IndyMac from federal regulators. The investors have already shared in nearly $1.9 billion in dividends since then.

OneWest grew larger in 2009 and 2010 after it acquired two failed banks. In 2009, OneWest Bank acquired First Federal Bank of California which had 39 branches, and in 2010 it acquired La Jolla Bank which had 10 branches.

My Take

IndyMac used to offer some great deals to depositors, and many of the deals continued for awhile under OneWest. However, the deals eventually dried up. For the last few years, OneWest deposit rates have been disappointing. So I’m not concerned about losing OneWest.

OneWest currently has 73 branches in Southern California. It’ll be interesting to see how this acquisition will affect those branches. It would be nice if CIT Bank’s products become available at OneWest branches. This would benefit those in Southern California who prefer to bank at brick-and-mortar branches. CIT Bank’s deposit products that it offers on its website have been very competitive.

Thanks to DA member me1004 for posting on this news in the forum.