KeyCorp may sell its subprime lending subsidiary, Champion Mortgage, to concentrate on community banking, the Cleveland-based company said Tuesday.
Headquartered in New Jersey, Champion provides mortgage financing and home equity loans in 26 states, with a loan portfolio of $2.5 billion.
“With KeyCorp’s renewed focus on community banking and strengthening our client relationships within our 13-state footprint, Champion no longer fits with our longer-term strategic priorities,” said KeyCorp Chairman and CEO Henry L. Meyer III. “Given these factors, our best strategic option is to explore the sale of the company.”
KeyCorp, which has assets of $95 billion, bought Champion in 1997. KeyCorp reported July 18 that profits in its consumer finance unit, which includes Champion, were down 21 percent from the same quarter last year.
Last month, another Cleveland-based bank, National City Corp., said it was looking to sell its First Franklin Financial subprime residential mortgage unit and its National City Home Loan Services processing unit.