GreenSky in Atlanta said plans by Truist Financial in Charlotte, N.C., to end a loan origination agreement will not have a material impact on its profitability.
The point-of-sale lender disclosed in a regulatory filing Wednesday that it had received notice from the $522 billion-asset Truist a day earlier that the regional bank would terminate the agreement. The termination will be effective on Nov. 9.
Truist announced on Tuesday that it plans to buy Service Finance, a Boca Raton, Fla., company that makes home-improvement loans, for $2 billion. The deal is expected to close later this year.
GreenSky said in its filing that it has “significant unused funding commitments for future loan originations.”
GreenSky noted several initiatives it has pursued to diversify its funding model. It has turned to the asset-backed securitization market and has entered into a $1.5 billion purchase agreement with a global insurance company.
Truist originations have comprised about 8% of GreenSky’s total transaction volume in 2021. GreenSky said its unused bank partner commitments on June 30, excluding Truist, totaled $2.5 billion, including a relationship with a new, unnamed bank.
“Demand for GreenSky program consumer loans from multiple funding sources remains high, cost of funds across funding sources remain low, and GreenSky continues to be poised for strong profitability,” the filing said.