BofA to Swap Online Unit for E-Loan Stake
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Bank of America, the nation’s largest bank, said it plans to swap its online auto loan unit for a 5% stake in Internet mortgage company E-Loan Inc. Under the agreement, Dublin, Calif.-based E-Loan will purchase CarFinance.com for 2.88 million shares of E-Loan and enter into a broad strategic alliance with Bank of America. E-Loan said it expects to complete the transaction, which enlarges its product offering to include the two most important types of consumer loans, before the end of September, subject to regulatory approval. Bank of America owns 80% of CarFinance.com, while the company’s president, Robert Ferber, and other individuals own the remaining 20%. Ferber will continue to manage the company. Bank of America shares rose $1.31 to close at $66.56 on the NYSE; E-Loan shares rose $1.13 to close at $23.38 on Nasdaq.
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