PNC Bank has decided to pull the plug on National City's warehouse lending operation, giving non-banks that borrowed from the unit 12 to 18 months to find new lenders, ASR sister publication National Mortgage News has learned.
At press time, a spokesman for the Pittsburgh-based PNC confirmed that the bank was indeed exiting the warehouse sector but would not comment on a time frame or how many jobs will be lost at NatCity's unit. (PNC bought the Cleveland-based bank earlier this year.)
According to exclusive survey figures compiled by National Mortgage News, National City ranks second, nationwide, in terms of warehouse commitments to non-bank mortgage lenders.
At year-end, NatCity's warehouse group had agreed (or committed) to lend $2.2 billion to non-bank mortgage firms. "This is really going to hurt," said one advisor who works on warehouse issues.
"NatCity is a big provider." The advisor, who requested his name not be used, said five non-bank borrowers received word of the pull out today. At year end the largest warehouse provider, in terms of commitments, was Colonial Bancgroup,
Montgomery, Ala. In trading Wednesday Colonial's shares ended at 36 cents. The depository has applied for government backing under the Troubled Asset Relief Program. A few weeks ago JPMorgan Chase exited the warehouse lending arena.