There’s one fewer player in the indirect auto lending sector. Compass Bank shuttered its indirect auto business Jan. 30 amid a restructuring at parent company BBVA Group, AutoFinanceNews.net has learned.
The bank’s auto portfolio totals nearly $4 billion. Its auto unit has 50 to 75 employees and does business with 1,800 dealers.
Loans in the pipeline as of Jan. 28 will be funded, and the bank will continue to service its existing portfolio.
Birmingham, Ala.-based Compass will still offer direct auto loans to car buyers via its branch network: 577 branches spread throughout Alabama, Arizona, Colorado, Florida, New Mexico, and Texas.
The closure comes on the heels of BBVA’s announcement last week to lay off 10% of its workforce — 1,200 employees— as it works to integrate a handful of acquisitions, including Texas State Bank and Laredo National Bank.
Spanish bank BBVA has $750 billion of assets and does business in more than 30 countries.
How can we pick up the dealer relationships? Do you know anyone at BBVA that we might talk to?
Whu would you close a “profitable” indirect auto business even with current volume declines? Especially when you can make more money when the volume switches to used cars where there are no interest rate subvention programs and theamount financed is really based on collateral values.
You cannot run a first class indirect auto busines with $4 billion in assets and only 50-75 employees.
If it was a first class business unit, they would need more than 75 people just in the loan collection department to handle the normal collection problems of that many auto loans.
When will we we hear the announcement about how much money the unit lost?
Steve, you bring up an excellent point. My short answer is, your point is well-worth considering, and we will do that. If you have any thoughts on how to accomplish this, we would welcome them.