Dallas, Texas 07/23/2014 (FINANCIALSTRENDS) – John Thain, the high profile ex-Merrill Lynch & Co CEO, best known for the sale of the premier bank during the financial crisis back in 2008 is in the news again. This time it is with another financial group he currently heads, the CIT Group Inc. (NYSE:CIT).
CIT Group in 2010, the time when Thain became the CEO, was just emerging from the financial crisis. Four years later the group is now headed to finalize and ambitious acquisition, which will see CIT, acquire OneWest bank for $3.4 billion.
As Thain in an interview commented, “All of the issues that existed when I joined the company as it came out of bankruptcy have basically been corrected.” And the time is now right for him to redeem himself from the mistakes he had made with Merrill Lynch. Thain in the past four years has ensured CIT Group Inc.(NYSE:CIT)has moved out of loss-making segments of the business such as loans for the student community, and has also led to doubling of the deposits.
In fact the financial crisis, followed by the mortgage scam by financial institutions has given rise to some lucky beneficiaries for being in the right place at the right time. These are millionaire hedge fund managers George Soros, John A. Paulson and others who acquired a banking service provider IndyMac, which plunged with the mortgage scam.
The benefits of this acquisition is now paying-off these investors, for IndyMac is currently the OneWest bank which CIT Group Inc.(NYSE:CIT) is buying for $3.4 billion.
First Offensive Strategy
Thain claims that the new buying venture is “really the first step in what I would call the offensive part of the strategy.”
The acquisition will now allow the group to access a range of retail deposits as well as low-cost funding ensuring high profits. The announcement of the purchase has led to the company surged 14%.