Life insurer ""MetLife"":http://www.metlife.com/ announced Thursday that it will exit the reverse mortgage origination business, with plans to sell the division responsible for these loans to ""Nationstar Mortgage LLC"":https://www.nationstarmtg.com/.[IMAGE]
A spokesperson with MetLife did not immediately return requests for comment.
It was not immediately clear how much Nationstar paid to buy the reverse mortgage portfolio from MetLife. A statement said that the transaction will need to clear certain regulatory hurdles and ""other customary closing conditions"" before it moves forward.
The life insurer also said that it would cease receiving any new reverse mortgage loan applications and registrations. MetLife said that retail banking, including reverse mortgages, accounted for less than 2 percent of operating earnings for the company last year.
In divvying up its share in mortgage originations, MetLife continues a process of divestiture from the banking holding business. The company sold off its stake in deposits to[COLUMN_BREAK]
""General Electric Capital"":http://www.gecapital.com/en/ in December last year and transitioned warehouse finance operations to ""EverBank"":https://www.everbank.com/ in February.
MetLife said that it was advised by ""K&L Gates LLP"":http://www.klgates.com/ and ""Deutsche Bank Securities Inc"":http://www.db.com/us/. in wrapping decisions to sell off its mortgage originations units.
The decision to shut the door on reverse home loans marks another turn away from mortgage originations for the life insurer. MetLife ""exited"":http://www.themreport.com/articles/metlife-departs-forward-mortgage-origination-business-2012-01-11 its share of the forward mortgage origination business in January.
Citing an ""uncertain marketplace and regulatory environment,"" a spokesperson with the company told _MReport_ in October that MetLife planned to ""continue our reverse mortgage origination operations, but... that, as a public company, we continuously evaluate all of our businesses based on market conditions.""
Analysts say that tough federal oversight helped expedite the company's departure from forward and reverse mortgage originations.
In the same month that it announced plans to stop originating residential mortgage loans, the ""Federal Reserve"":http://www.federalreserve.gov/ ""rejected plans"":http://www.themreport.com/articles/fed-rejects-metlife-plan-likely-speeding-mortgage-exit-2011-10-26 by MetLife to move forward with stock repurchases and capital redistributions that aimed to shore up annual dividends for investors. The Fed had cited a ""revised adverse macroeconomic scenario"" in the decision.
At the time, ""_Bloomberg News_"":http://www.businessweek.com/ quoted Dan Theriault, an analyst with ""Portales Partners LLC"":http://portalespartners.com/, as calling the rejection ""an embarrassment for the company."" He said that he expected MetLife to ""accelerate its plans"" to leave the origination business.
It is uncertain how many jobs will filter out of MetLife as the company leaves reverse mortgage originations. The decision to close down forward mortgage originations led the life insurer to ""axe"":http://www.themreport.com/articles/leaving-forward-originations-metlife-plans-to-axe-804-jobs-2012-02-06 804 jobs in Texas in February.