Seattle-based HomeStreet Bank, a unit of HomeStreet Inc., has agreed to sell a portion of its single-family mortgage servicing rights.
Under the deal, HomeStreet Bank is selling the rights to service approximately $4.9 billion in total unpaid principal balance of single-family mortgage loans serviced for both Fannie Mae and Freddie Mac. The amount represents roughly 20% of HomeStreet Inc.'s total single-family mortgage loans serviced for others as of March 31. In connection with the announced sale, HomeStreet Bank also expects to transfer an estimated $27.2 million of related deposit balances to the buyer.
The announcement comes weeks after Blue Lion Capital, a HomeStreet Inc. shareholder, called on the bank to significantly reduce its mortgage business or engage an investment bank to explore a sale.
HomeStreet Inc. Chairman, President and CEO Mark Mason said the transaction "will provide regulatory capital relief to support the continued growth of [the company's] commercial and consumer banking business."
The physical transfer of servicing is scheduled to close by Aug. 16. HomeStreet Inc. will continue to service the loans between the closing date and the final transfer date.
The company decided to keep the roles of CEO and chairman combined and reelected Mark Mason as board chairman. Additionally, Donald Voss was elected as lead independent director, effective immediately. Voss, who joined HomeStreet's board in March 2015, succeeds Scott Boggs, who has served as lead independent director since 2015.