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BB&T is in the process of buying Collateral Real Estate Capital LLC out of Birmingham, Alabama. Collateral is a 10 billion dollar loan servicing company that has a portfolio in 43 states.

I have been wondering when the roll up will start and now it looks like the time. The first step was destroying the markets for bad loans which was choking the industry. Subprime and Alt-A lenders are now nearly all gone or have revamped their business model. Now is the time for the big banks and brokerages to start rolling up the smaller players who do not have access to capital and whose business models are clearly stressed. Once that is done, the markets should be opened back up with just a few large lenders out there.

BB&T would combine Collateral with Laureate Capital LLC, its existing commercial mortgage banking firm, and give BB&T one of the largest full- service commercial and multifamily mortgage banking companies in the nation. The combined company would have a commercial real estate servicing portfolio of more than $20 billion.
The transaction is subject to regulatory approval and investor consents and is expected to be completed in the fourth quarter. The combined company’s new name and brand will be announced at closing. Terms were not disclosed.
“This acquisition is consistent with our announced strategy to add high quality, well managed, nonbank financial services companies,” said Clarke Starnes, BB&T’s manager of Specialized Lending. “Partnering with the very experienced professionals at Collateral will significantly strengthen our commercial mortgage franchise with a compatible business and management team.” Press Release via CNN Money

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