Fifth Third Bancorp Expands Multifamily Financing With $1.8B DUS Acquisition

CINCINNATI — Fifth Third Bancorp (NASDAQ: FITB) announced it has entered into a definitive agreement to acquire Mechanics Bank’s Delegated Underwriting and Servicing (DUS) business line. The transaction includes a $1.8 billion unpaid principal balance servicing portfolio and Mechanics Bank’s experienced DUS team.

Fifth Third Expands Multifamily Financing

The acquisition is intended to enhance Fifth Third’s ability to finance multifamily housing and provide direct access to Fannie Mae’s multifamily lending platform. The DUS program allows approved lenders to underwrite, originate, and service multifamily loans on behalf of Fannie Mae, supporting liquidity and stability in the housing market.

John Hein, head of Commercial Real Estate at Fifth Third, said the acquisition strengthens the bank’s leadership in commercial real estate finance and expands its ability to serve multifamily developers and investors. “Multifamily housing is the largest component of our commercial real estate portfolio, and this move enables us to better support our clients and the housing needs in the communities we serve,” Hein said in the announcement.

Transaction Details

Under the agreement, Fifth Third will acquire Mechanics Bank’s DUS license, servicing platform, and related assets. The acquisition is subject to customary closing conditions and third-party approvals, including approval by Fannie Mae. Financial terms beyond the $1.8 billion unpaid principal balance were undisclosed.

Advisors

Goldman Sachs is serving as financial advisor to Fifth Third, with Alston & Bird acting as legal counsel. J.P. Morgan Securities LLC is serving as financial advisor to Mechanics Bank, with Wachtell, Lipton, Rosen & Katz providing legal counsel.

About Fifth Third Bancorp

Fifth Third Bancorp, headquartered in Cincinnati, operates Fifth Third Bank, National Association, a federally chartered institution. The company’s common stock is traded on the NASDAQ Global Select Market under the symbol FITB. Additional information is available at ir.53.com.

Source

Source: Fifth Third Bancorp press release