By Chris Schilling, The Republic
cschilling@therepublic.com
Irwin Financial Corp. had reached an agreement with a company to "substantially reduce exposure to national home equity risk" by selling $1 billion in home equity loans, but the deal fell through, leaving IFC saddled with the loans.
The deal with New York-based Roosevelt Management Co. LLC needed approval from third parties, but the parties did not give consent in the required time.
The third parties were insuring agencies and trustees, large institutions that have a right to control who does the servicing on those investments, IFC Chief Administrative Officer Matt Souza said.
Roosevelt could not get consent from them in time, IFC has said.
Unloading the $1 billion was part of IFC's planned restructuring and would have infused the corporation with cash.
IFC's bank subsidiary, Irwin Union Bank and Trust Co., entered into the agreement with Roosevelt in July.
The agreement was terminated in September.
However, Souza said IFC is still discussing selling the home equity portfolio.