MNC Financial Inc. said yesterday that it has completed the sale of its consumer-finance subsidiary, Landmark Financial Services Inc., to Commercial Credit Co. for about $369 million.
The proceeds from the sale, about $5 million less than originally expected by the banking company, will be used to reduce the company's debt, MNC said.
The agreement to sell Landmark, signed Dec. 19, is part of a spate of planned asset sales that MNC has said would be used to raise much-needed cash. MNC is the parent of Maryland National Bank and American Security Bank in Washington. Baltimore-based Commercial Credit is a unit of Primerica Corp.
Yesterday's announcement was an important step in MNC's efforts to meet a crucial Jan. 14 deadline by which it must repay $375 million to a group of banks.
The troubled banking company also must buy back $271 million in debt from investors Jan. 15 and an additional $275 million Feb. 5.
Sales of other company subsidiaries, including the prized credit card division, MBNA America, are expected to help meet those deadlines.
Landmark, based in Silver Spring, was put on the block in late October, when MNC faced a potentially severe cash crunch as losses mounted and a series of large debt payments was nearing.
With $525 million in assets, Landmark has about 470 employees in 116 offices in 10 states. The company has about 50 employees in its Silver Spring headquarters and 25 in seven branches throughout the state.