Fremont dumps bad loans

Fremont General is taking an important step this morning in an effort to stay in business: It's unloading its lousy subprime loans. The Santa Monica-based insurer, through its Fremont Investment & Loan unit, has agreements to sell at a discount about $4 billion of its subprime loans. The sale will result in a pretax loss of about $140 million, but at least it brings in much-need cash - about $950 million so far, and more to come. No buyers were named. It's worth noting that Fremont does more than subprime loans; it has a commercial real estate lending operation and a retail banking division, and both had been doing well. Fremont, which has given layoff notices to the 2,400 employees in the subprime lending unit, intends to leave the residential loan business. Fremont stock is up a lot this morning. Reuters

More by Mark Lacter:
American-US Air settlement with DOJ includes small tweak at LAX
Socal housing market going nowhere fast
Amazon keeps pushing for faster L.A. delivery
Another rugged quarter for Tribune Co. papers
How does Stanford compete with the big boys?
Those awful infographics that promise to explain and only distort
Best to low-ball today's employment report
Further fallout from airport shootings
Crazy opening for Twitter*
Should Twitter be valued at $18 billion?
Recent stories:
Siri versus Hawaiian pidgin (video)
Letter from Down Under: Welcome to the Homogenocene
One last Florida photo
Signs of Saturday: No refund
'I Am Woman,' hear them roar

New at LA Observed
On the Media Page
Go to Media

On the Politics Page
Go to Politics
Arts and culture

Sign up for daily email from LA Observed

Enter your email address:

Delivered by FeedBurner

Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
Mark Lacter, business writer and editor was 59
The multi-talented Mark Lacter
LA Observed on Twitter and Facebook