Springleaf, a Former Unit of AIG, Will Become the Biggest Subprime Lender

Subprime

Springleaf to buy Citi’s OneMain to become top U.S. subprime lender

(Reuters) – Springleaf Holdings Inc (LEAF.N) said it would buy Citigroup Inc’s (C.N) OneMain Financial Holdings Inc for $4.25 billion in cash, creating the largest subprime lender in the United States.

Citigroup has been seeking to hive off OneMain since at least 2011 as part of the No. 3 U.S. bank’s plan to sell unwanted assets and focus on wealthier clients.

The deal will create a lender with $15 billion in assets and nearly 2,000 branches, serving the large and growing population of non-prime customers in the United States.

Springleaf shares soared 38 percent to a record $52.44 on Tuesday. Citigroup’s shares were marginally higher at $53.73.

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