Citigroup announced today that it will acquire Ann Arbor, Mich.-based ABN AMRO Mortgage Group (AAMG), a national originator and servicer of prime residential mortgage loans. Citigroup will purchase approximately $9 billion in net assets and ABN AMRO Mortgage Group's approximately $224 billion mortgage servicing portfolio.
ABN AMRO Mortgage Group, a subsidiary of LaSalle Bank Corporation and ABN AMRO Bank N.V., conducts its primary originations business via wholesale lending under the InterFirst brand. Terms of the transaction were not disclosed.
"The acquisition of ABN AMRO Mortgage Group demonstrates our commitment to grow our consumer lending business in the U.S.," said Carl Levinson, president and CEO of Citigroup's Consumer Lending Group. "As a best-in-class provider and servicer of residential mortgages, we will be able to provide ABN AMRO Mortgage Group's customers with an expanded suite of products while increasing our distribution channels in new and existing markets.â€?
The acquisition of ABN AMRO Mortgage Group will add approximately 1.5 million servicing customers to CitiMortgage, Inc.'s portfolio as well as 2,500 wholesale brokers to its wholesale lending business. When combined with CitiMortgage's strong market presence, the combined company will move from number five to number four in mortgage loan servicing and strengthen CitiMortgage's number three market position in originations, based on third quarter 2006 numbers.
"This compelling transaction will enable us to serve more customers better and will allow us to deliver greater efficiencies through combined product, service and leading-edge technology platforms," said Bill Beckmann, president of CitiMortgage. "ABN AMRO Mortgage Group has a leading wholesale originations franchise, a strong and active broker network and an excellent loan servicing business, which will complement our continued growth in all channels -- retail, correspondent and wholesale. We look forward to delivering a wide array of outstanding products and services to brokers, allowing them to significantly expand their offerings to customers."
The transaction is expected to close in the first quarter of 2007 and is subject to customary regulatory filings and approvals.