RBC to Sell Mortgage Assets to New Century

The Royal Bank of Canada has made plans to sell certain assets of its U.S.-based RBC Mortgage Corp. unit to New Century Financial Corp., the Irvine, Calif.-based parent company of one of the largest U.S. nonprime mortgage finance companies, and Home123 Corp., one of its wholly owned subsidiaries."Following a review of our U.S. operations, we determined that the national mortgage business was not strategic to achieving our goals," said Peter Armenio, group head, U.S. and international, for RBC Financial Group. Jonathan Threadgill, president and chief executive officer of RBC Mortgage, will be joining New Century upon the closing of the transaction, according to RBC. RBC said the cash transaction "is expected to be accretive to the company's earnings per share within the first 12 months following the close of the transaction," which is expected in the third quarter. The company did not disclose specific terms of the acquisition. Robert K. Cole, chairman and chief executive officer of New Century, said the purchase "represents less than 4%" of his company's market capitalization.