Three months after it received regulatory approval to buy ING Direct USA, Capital One Financial Corp. confirmed that it plans to close the online bank’s West L.A. office and lay off about 280 employees.
The move, which will take effect by July, is the result of a decision by Capital One to end its indirect mortgage lending business.
“Exiting the indirect home loans business allows Capital One to focus on its preferred direct-to-consumer mortgage origination model,” Capital One spokeswoman Julie Rakes said in a statement to the Business Journal.
Through indirect mortgage lending, also known as wholesale lending, companies such as Capital One fund loans funneled to them by independent mortgage brokers. Amid a pullback in the mortgage market, many lenders, including Bank of America Corp., have closed their wholesale divisions.
Rakes said the remaining work done at the L.A. location will be redistributed to existing Capital One offices in Wilmington, Del., and St. Cloud, Minn. A café affiliated with ING on the ground floor of the West L.A. office, near the intersection of Santa Monica and Sepulveda boulevards, will remain open.
Capital One, a credit card giant headquartered in McLean, Va., received approval from the Federal Reserve in February to acquire the online banking operations of ING Groep NV for $9 billion. The deal, which added $80 billion in deposits, turned Capital One into the fifth largest bank in the United States by deposits.
Capital One also plans to close some units of its newly acquired HSBC credit-card operations, including offices in Salinas and Buffalo, N.Y.
New Name
Lockheed Federal Credit Union announced last week that it plans to change its name to Logix in July.
The Burbank credit union, the largest in Los Angeles County by assets, said it has worked with a branding company for the past year to come up with the unusual new name and a promotional campaign that would help the institution grow. The institution also unveiled a new tagline: “smarter banking.”
The change was necessary, executives said, because the existing name created confusion among prospective members, many of whom thought only employees of aerospace company Lockheed Martin could join. Though the credit union was established 75 years ago for employees of what was then Lockheed Corp., nearly everyone is eligible to join today.
“We chose the name Logix because it is distinctive, memorable and suggests a smarter, more logical banking choice,” Chief Executive Dave Styler said in a statement.
Lockheed has $3.2 billion in assets and 11 branches. But with just 107,000 members, it trails far behind local competitors Kinecta Federal Credit Union and Wescom Credit Union.
C-Suite News
TCW Group Inc., an asset management firm in downtown Los Angeles, said it has hired Jerry Cudzil as managing director and head of U.S. credit trading. … Century City investment bank Houlihan Lokey said that Joshua Tanzer was hired as managing director and head of the private growth equity capital practice. … Wells Fargo & Co., the San Francisco banking giant, announced that Kathleen McClure-Wight was named government banking division manager based in Los Angeles. She will oversee the western U.S. … PricewaterhouseCoopers announced that Bill Barbagallo was hired as managing director of the actuarial and insurance management team in Los Angeles. … Rick Lopez has been hired as vice president and senior relationship manager for the commercial and industry group in the Long Beach office of First Bank.
Staff reporter Richard Clough can be reached at [email protected] or at (323) 549-5225, ext. 251.
