Valley National in New York sells $925 million of CRE loans

Valley National Bancorp in New York sold $925 million of commercial real estate loans at a loss.

The $62 billion-asset company, which recently raised capital, said in a press release that it sold the loans, including $823 million of previously identified loans, to Brookfield Asset Management. The loans were sold at a roughly 1% discount, translating into an “incremental immaterial net loss.”

Valley will retain customer-facing servicing responsibilities.

The sale “has helped to accelerate progress towards our strategic balance sheet goals,” Ira Robbins, Valley’s chairman and CEO, said in the release.

“Throughout the year we have patiently monitored loan sale opportunities in the context of our deep understanding of the intrinsic value of our assets and the unique dynamics of the markets that we serve,” Robbins added. “This deliberate approach resulted in only a modest transaction discount to par, exclusive of other selling costs, which further reflects the strength and desirability of our diverse commercial real estate portfolio.”

Valley raised nearly $449 million last month by selling common stock to offset any losses from purging loans.