Bank of Ireland Team Jumping Over to CIT
CIT Group has tapped Matthew Galligan and several other Bank of Ireland executives to relaunch its commercial real estate lending operation.
Galligan, head of Bank of Irelandís U.S. real estate unit, will move over to CIT along with three or four other executives, including senior advisor Meggan Walsh. While the timing and final agreements were still being nailed down this week, both sides have agreed in principle, according to market pros.
Word of the move comes about a week after Bank of Ireland agreed to sell a $1.4 billion portfolio of high-quality U.S. commercial mortgages to Wells Fargo as part of an effort to raise capital and wind down its U.S. activities. Bank of Ireland offered the commercial mortgage operation intact ó including Galligan and his roughly seven-member team. But Wells decided it didnít need them.
CIT pulled out of the commercial real estate financing business in January 2008, paring its lending operations after suffering steep losses in its residential-mortgage and student-loan businesses. The New York finance company laid off the bulk of its 27-member commercial real estate team, including managing director Tim Zietara, who oversaw the group.
Galligan has become well-known in lending circles during a lengthy career in originations and syndications. Bank of Ireland hired him in 2007 as a managing director to set up a commercial mortgage platform. Galligan spent the previous two years as an executive vice president at DebtX, the Boston loan-sale advisory firm. From 1996 to 2002, he was a managing director of FleetBoston Financial, where he managed commercial real estate loan syndications. He moved over to Fleet when it acquired Bank of Boston, where Galligan worked from 1986 to 1996. He previously spent 10 years at Chase Manhattan.
Bank of Ireland put its U.S. portfolio up for sale after lending woes in Europe prompted the Irish government to pump in capital in return for a 36% ownership stake. Irish regulators directed Bank of Ireland to chop its total loan portfolio by around $44 billion by the end of 2013. Two other Irish banks that were nationalized because of losses ó Allied Irish and Anglo Irish ó have also shopped large portfolios.
Although Bank of Ireland suffered heavy losses in Europe, its U.S. loan portfolio was profitable and performing well. Most of the mortgages have loan-to-value ratios of less than 70%.