First American to split, sell mortgage subsidiary

June 23, 1993|By David Conn | David Conn,Staff Writer

First American Bankshares Inc. of Washington, slated to be sold to a North Carolina banking company, announced yesterday that it has agreed to split its nearly $1 billion mortgage subsidiary into two parts and sell them to separate buyers.

The $930 million loan servicing portfolio of First Advantage Mortgage Corp. would be sold to Atlantic Residential Mortgage Corp., a unit of Baltimore Bancorp, according to a contract signed by the two companies.

The remaining assets and operations of First Advantage Mortgage, including its mortgage origination business, would be sold to Leader Financial Corp., an investment and mortgage banking company based in Cleveland.

First Advantage, which has about 250 employees in six states and the District of Columbia, would remain based in Columbia, and Leader Financial would change its name to First Advantage Mortgage Corp., the companies said yesterday.

Emanuel Nadler, a New York businessman who owns Leader Financial, would become chairman of First Advantage, and Albert C. Kocourek, currently president and chief executive of First Advantage, would remain in those posts. Mr. Kocourek said the company originated about $810 million in mortgage loans last year.

Baltimore Bancorp's Atlantic Residential Mortgage, meanwhile, would expand by almost 50 percent with the completion of this deal, which is subject to regulatory and other approvals. Atlantic Residential currently has a $2 billion mortgage-servicing portfolio, according to its president, Keith Stackhouse.

Last year, Atlantic Residential originated about $1 billion in mortgages, about one-third of which were sold to investors in the secondary mortgage market, Mr. Stackhouse said. The company, which took in more than $6 million in revenues last year, probably would hire about a dozen people at its Baltimore processing center, he said.

First American is in the process of being sold to First Union Corp., of Charlotte, N.C. The Washington-based company's sale had been ordered by the federal court that was overseeing the dissolution of the Bank of Commerce and Credit International's American operations, of which First American was a part. The company owns the First American banks in Virginia, Washington and Maryland.

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