Popular, a financial services provider in Puerto Rico, the U.S., the Caribbean, and Central America, announced an agreement today to sell the loan and servicing assets of its U.S. mortgage subsidiary, Popular Financial Holdings, to various Goldman Sachs affiliates. The sale includes approximately $1,170 million in loans and mortgage servicing assets, and is expected to close in the fourth quarter of 2008. The deal should provide $700 million in additional liquidity, while also reducing Popular's U.S. subprime assets. The company will take a hit of approximately $450 million in connection with the transaction.

Aside from boosting liquidity, part of the drive behind the sale was to reduce the company’s U.S. business exposure."We are continuing to narrow the scope of our mainland U.S. operations that are most exposed to the credit and mortgage markets, by leveraging on our core strengths in Puerto Rico , where we are the undisputed market leader," said Richard L. Carrion , chairman, president and chief executive officer of Popular.

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