CIT dives into the adult pool (joins "big boy" club")

CIT Group to Buy OneWest; Profit Tops Estimates - Deal with IMB Holdco, OneWet's Parent Company, To Bump CIT's Assets to $67 Billion


CIT Group Inc. agreed to buy OneWest Bank NA's parent company for $3.4 billion in the largest bank acquisition announced so far this year. The cash-and-stock deal with IMB Holdco LLC, which is OneWest's parent company, will bump CIT's assets up to $67 billion, making the bank large enough to be considered "systemically important" by regulators. CIT, a lender to small and medium-size businesses, had $44.15 billion in assets as of June 30, CIT shares rose more than 10% in early trading as investors cheered the company's move, which will add deposits, a presence in California retail branch banking and a stable source of funding. "My first comment was wow," said Sterne Agee analyst Henry J. Coffey Jr. on CIT's earnings call. "This is incredible." CIT Chief Executive John Thain recently told investors he was looking for a significant deal so that his firm jump comfortably over the $50 billion level rather than edge over it by a bit. That is because the avalanche of regulations that comes with topping $50 billion isn't worth it without a significantly bigger earnings engine.
Comment: Love the typo (red box)

For Banks Near Cutoff, Bigger Isn't Necessarily Better - For Banks About to Grow Into 'Systemically Important' Designation, Size Brings a New Set of Headaches


Mr. Ficalora is CEO of New York Community Bancorp, a lender in Westbury, N.Y., with $47.6 billion in assets as of the end of the first quarter. The bank is projected to reach the $50 billion mark by the end of the year if it continues to expand at its current rate. But with that milestone will come myriad headaches. Once the bank reports assets of more than $50 billion on average for four quarters in a row, NYCB, as it is known, will be large enough to be considered "systemically important" by regulators. That status will require it to comply with stiff rules on capital, submit to yearly "stress tests" and create a road map to wind down the bank in the event of a crisis, moves that will add to its costs. As a result, Mr. Ficalora says NYCB is restraining its lending growth, since loans amount to assets. The rule characterizing bank holding companies over $50 billion as systemically important is part of the regulatory overhaul that followed the financial crisis and is aimed at keeping a closer eye on banks whose potential problems could endanger the broader financial system.
Comment:  Images snipped from articles. NYCB has a 6.4% dividend! Interesting

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