Sovereign Exiting Warehouse Lending

Stung by warehouse lines it made to the now-defunct Taylor, Bean & Whitaker, Ocala, Fla., Sovereign Bank of Pennsylvania has decided to exit the sector, according to warehouse lending officials and customers that received credit from the bank. Sovereign officials declined to comment. The bank's decision to leave the market comes as more banks are considering either getting into warehouse lending or expanding their presence in the market -- but only for well capitalized nonbanks. "I think the days of unavailable warehouse credit being a huge problem could be coming to an end -- if you have enough capital," said one New York-based mortgage advisor. Meanwhile, at least two investors are still talking with PNC Financial Services about buying the warehouse division it inherited through its purchase of National City Corp. The NCC unit recently extended some of its existing lines to certain nonbank customers. PNC declined to comment.