Wells Fargo to Buy Energy Lending Business

Wells Fargo to Buy Energy Lending Business

ICTMN Staff
2/22/12

Yesterday Wells Fargo entered a definitive agreement to buy the North American energy loan business of the French bank BNP Paribas in an all-cash deal, reported Zacks Equity Research.

BNP’s North American business is primarily concentrated in the United States, reported The New York Times. The deal is expected to close in the second quarter of 2012, pending on regulatory approvals and following customary closing conditions.

The Houston, Texas-based energy business holds nearly $9.5 billion worth of loan commitments and about $3.9 billion in loans that have been lent out.

The price Wells Fargo paid and other terms of the deal were not disclosed.

BNP and other banks hurting from the European debt crisis are trying to reduce their lending commitments, the Times reported.

The transaction will strengthen Wells Fargo's energy banking business. Wells Fargo, which emerged as one of the United States' stronger banks following the financial crisis, reported a 20 percent gain in quarterly profit last month.

Wells Fargo's Native American Lending office is based in Sioux Falls, South Dakota. In 2010, Wells Fargo lent $999 million in mortgages to Indians.

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