Magazine article American Banker

Fleet Closing out Retail Presence in the South

Magazine article American Banker

Fleet Closing out Retail Presence in the South

Article excerpt

Fleet Financial Group is shuttering its last retail mortgage unit in the South, closing the final chapter of a five-year saga.

The Boston banking company said it no longer needs its DeKalb, Ga., loan processing unit because its retail mortgage business is now consolidated in the Northeast.

The action means the loss of about 200 jobs, according to the Atlanta Business Journal, which reported the news this week.

The processing center is the bank's last Georgia operation and all that remains of Fleet Finance, its Atlanta-based consumer finance company.

Now the company's only retail originations are conventional loans made through its bank branches in the Northeast. Many other large regional banking companies have been striving for nationwide retail platforms and adding on subprime units.

Fleet Finance was subject to a series of investigations concerning alleged fair-lending violations, and it ultimately was sold. Fleet no longer makes subprime loans.

In 1993 Fleet Finance Inc. promised cash to borrowers who had been charged too much, commitments to community investment, and debt forgiveness to some Georgia borrowers, totaling $100 million, after an investigation by the state attorney general. The unit had been buying loans with exorbitant interest rates from companies that were pushing them in lower-income neighborhoods, the investigation found.

The company was also investigated by the Department of Justice in 1995 for allegedly charging minorities higher loan origination fees and interest rates.

Fleet sold most of the assets of its finance company to Associates First Capital Corp. …

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