Washington Mutual is close to winding down its syndicated loan portfolio and has less than 20 names left to potentially sell to the market. In July, the bank announced it is exiting lending to businesses whose revenues exceed $5 million.
The bank had commitments on the syndicated loan side of about $1 billion at the time, said a banker familiar with the situation. Since then, the group has either sold off in the secondary or sold to a specific bank that's already in the facility after the borrower directed WAMU to keep the commitment within the group, the lender said. More than half of the portfolio has been refinanced out by companies bringing new deals to lower spreads, he added.
The remaining names will be sold either back to the agent, to an existing bank in the facility, to a dealer or to another bank, said the lender. According to this banker, WAMU has sold loans to various lenders including Citigroup, Bank of America, Credit Suisse First Boston and HSBC.
Syndicated lending, equipment finance, energy lending and asset-based lending are in the process of being disbanded and this process should conclude by January. "Washington Mutual recently announced a series of steps designed to sharpen the focus of our commercial group, which allows us to better focus our teams on major markets, products and services where we can best serve our commercial customers," said a spokeswoman. This includes the closure of approximately 50 commercial banking locations, which provided banking services to mid-to-large-sized companies, she added.
