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Truist is weighing a sale of Afco Credit, which finances insurance premiums, Bloomberg reported on Oct. 26, citing unnamed sources. The review is at an early stage, and Truist has declined to comment; a sale may not happen. The reported move follows other efforts by the bank to exit or reduce lending businesses it considers noncore.
Truist is exploring a sale of Afco Credit, a specialty lender that finances insurance premiums, Bloomberg reported Monday, Oct. 26, citing people familiar with the matter. The reported review comes as the bank looks to shed lending operations outside its core business, but it is preliminary and may not result in a deal.
According to Bloomberg’s report, Truist is considering either selling Afco Credit outright or selling its assets. The report described the process as being in its early stages. It did not identify a potential buyer or provide a valuation, and no transaction has been announced by Truist.
Asked about the report by PYMNTS, a Truist spokesperson declined to comment. The available reporting does not specify how many potential buyers, if any, have been approached, what assets a possible transaction would include, or whether Truist has set a timetable.
Afco provides insurance premium financing, a form of lending that allows customers to pay insurance costs over time rather than in one payment. The reported sale review would add to a series of moves involving Truist’s consumer and specialty lending operations. The bank has said its broader strategic review is ongoing.
Truist’s Lending Portfolio Shrinks
A possible Afco sale would fit a broader effort to concentrate Truist’s lending on areas the bank views as more closely connected to its core banking business. The bank has described some lending operations as noncore and less profitable, while executives have pointed to products linked more directly to customer deposit relationships.
For Afco customers and insurance brokers who use premium financing, a change in ownership could affect who provides the financing, although no operating changes have been announced. The report does not say whether a buyer would keep Afco’s current business model, staff or customer arrangements. Those questions would depend on the terms and structure of any transaction.
For Truist, a sale could reduce its exposure to a specialty lending business and potentially free resources for other priorities. That is an implication of the reported review, not a confirmed outcome: the bank has not announced a sale, and the report says a transaction may not be completed.
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Recent Exits From Consumer Lending
The Afco report follows several changes to Truist’s lending portfolio. In September, the bank disclosed that it was selling $5.5 billion in auto loans and exiting near-prime auto lending. Truist said the loans represented substantially all the assets of its national auto finance affiliate, Regional Acceptance Corporation, and described the exit as part of a plan to sharpen its strategic focus.
Truist had also discontinued its marine and recreational vehicle loan business. Separately, Carlyle said in an Oct. 16 press release that its Global Credit platform had agreed to buy a $7.7 billion portfolio of unsecured personal loans from Truist. Carlyle said the transaction was expected to close in the fourth quarter, subject to customary closing conditions. That announced portfolio transaction is distinct from the reported, preliminary Afco review.
On an Oct. 16 earnings call, Truist management said it was reducing parts of its consumer loan book and shifting consumer lending toward products tied more directly to deposit relationships, including credit cards, home lending and unsecured loans. Mike Lyons became Truist CEO on Sept. 1; the moves are taking place as he leads the bank’s current strategic direction.
“The bank said the move aimed to sharpen its strategic focus by exiting a noncore, less profitable business.”
— Truist, in a September SEC filing about its auto lending exit
Sale Terms and Buyer Remain Unknown
The reported Afco process remains unconfirmed by Truist. Bloomberg cited unnamed sources, and the bank declined PYMNTS’ request for comment. There is no publicly identified buyer, asking price, transaction structure or expected closing date.
It is also unclear whether Truist is testing interest from potential buyers or has begun a formal sale process, which Afco assets could be included, and how a transaction might affect customers, brokers or employees. The report explicitly says a deal may not be reached; until Truist or a buyer announces terms, the outcome and rationale specific to Afco remain uncertain.
Watch for a Formal Sale Process
The next concrete development would be confirmation from Truist, disclosure of a potential buyer, or an announcement describing a transaction. Until then, the reported review should be treated as preliminary rather than a completed sale. Truist has said its strategic review is ongoing, but it has not provided a timetable for Afco or said whether it will pursue a deal.
If an agreement is reached, key details to watch include the assets being transferred, the buyer, the purchase price and any conditions to closing. For now, no Afco transaction has been announced, and the status of the reported exploration could change.
Key Questions
Is Truist selling Afco Credit?
Not yet. Bloomberg reported that Truist is exploring a sale, but the review is at an early stage and no deal has been announced. The report says a transaction may not happen.
What does Afco Credit do?
Afco is a specialty lender that provides insurance premium financing, allowing insurance costs to be paid over time. The report does not give further detail about its customer base or portfolio.
Who might buy Afco Credit?
No potential buyer has been identified in the report. Truist has not commented on the reported exploration.
How does this fit Truist’s other lending moves?
The reported Afco review follows Truist’s disclosed plan to sell $5.5 billion in auto loans, its exit from near-prime auto lending, and Carlyle’s agreement to buy a separate $7.7 billion portfolio of Truist personal loans. The transactions are distinct, and the Afco review remains preliminary.
Source: pymnts.com
