Morning Brief: Capital One to Buy Chevy Chase
In a local match-up born out of the financial crisis, Capital One, the McLean credit card company, is expected to buy Chevy Chase Bank, a landmark Washington financial firm with branches throughout the region, sources familiar with the matter told the Washington Post.
Capital One, which would pay $520 million in cash and stock, has received a $3.56 billion investment from the Treasury Department as part of the government's effort to stabilize the banking industry.
Sources said that the deal should not have any immediate effect on Chevy Chase depositors or borrowers and that no layoffs are currently planned. Chevy Chase, which faced massive losses on its portfolio of risky home loans made to borrowers during the housing bubble, was founded 39 years ago by B.F. Saul, a local businessman, and it is still controlled by his family.
Capital One would get Chevy Chase's 250 branches -- the wealthy region's largest branch network. Capital One has pursued a strategy in recent years of buying regional banks to get access to their deposits, which the company uses as a cheap source of funding for its credit card operations.
Another major Washington area financial firm is making news this morning. The Carlyle Group said on Wednesday it will lay off 10 percent of its staff as a worsening economy hinders dealmaking. Staff writer Tom Heath had a post up earlier but the full story is now here.
And a decades-long housing boom that made Loudoun County one of the nation's fastest-growing bedroom communities is over. Now the county is trying to come up with some creative solutions to fill the gap.
Supervisors considered, but ultimately rejected, a proposal to spend $100,000 of taxpayer funds for a marketing partnership with the Washington Redskins. The concept involved declaring Loudoun the "Corporate Home of the Washington Redskins."
December 4, 2008; 8:28 AM ET
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