Popular Bank to acquire Reliable, Wells Fargo’s car loan business in Puerto Rico
As part of the transaction, Banco Popular will acquire approximately $1.5 billion in retail auto loans and $340 million in commercial loans. The loan portfolio has credit characteristics that are similar to Popular’s own portfolio, the bank said in a release.
The cash transaction is expected to be of about $1.7 billion, “reflecting an aggregate discount of 4.5% on the assets to be acquired.” Popular said it will fund the purchase price with existing liquidity and anticipates the transaction to close during the second quarter of 2018.
Reliable employees will become Popular employees, but Reliable will continue operating as an independent division of the bank until it is integrated into its own auto finance operation, Popular Auto.
“Even in this period of significant uncertainty, Popular continues to believe and invest in the future of Puerto Rico,” Ignacio Álvarez, CEO of the bank’s holding company, Popular Inc., says in the release.