Popular, Puerto Rico’s largest bank, said this morning it had agreed to buy online consumer-direct lender E-Loan for about $300 million in cash, expanding its U.S. lending businesses.

The transaction will expand Popular’s reach in the U.S. market and complement its existing nonprime and warehouse-lending businesses. E-Loan originated more than $5 billion in mortgage, home equity and auto loans in 2004.

E-Loan will maintain its brand and become a unit of Popular Financial Holdings, operating in Pleasanton, Calif. Mark Lefanowicz, the CEO and president of E-Loan, will serve as president. Additionally, E-Loan will retain most of its employees.

The transaction is expected to close in the fourth quarter.

Shares of E-Loan had jumped $1, or 32.36 percent, to $4.09, at 11 a.m. Eastern time today, while Popular was holding steady at $26.32.

This has been a good year for E-Loan. In May, the company reported first-quarter earnings of $2.2 million, or 3 cents a share, compared to a loss of $1.1 million, or 2 cents a share, in the same period a year ago.

A group of Wall Street analysts polled by Thomson First Call had predicted that the company would break even, neither losing nor gaining. E-Loan exceeded these expectations with its $2.2 million profit.

***

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