Subsidiary of Japanese Bank to Buy Deutsche Bank U.S. CRE Platform

Union Bank NA, a San Francisco-based subsidiary of The Bank of Tokyo-Mitsubishi UFJ Ltd., has agreed to buy the commercial real estate lending and servicing platform of PB Capital Corp., a wholly owned subsidiary of Deutsche Bank AG. Terms of the deal were not disclosed except that the compensation will be paid in cash.

PB Capital has a $3.7 billion CRE loan portfolio, of which 69% was originated after 2007. It has an estimated 63% weighted average loan-to-value ratio and a $52 million average loan size. Office buildings in major U.S. cities account for about half of the portfolio. For 2012, there was nearly $1 billion of new originations.

The Northeast is home to 51% of the portfolio, including 35% of the properties being located in the New York area.

Union Bank brings its own $5 billion CRE portfolio to the transaction. “This is an important strategic acquisition for Union Bank, as it leverages our established CRE capabilities by adding a national origination platform and strong relationships with top-tier property owners,” said Union Bank president & CEO Masashi Oka. “The transaction also enables the Bank of Tokyo-Mitsubishi UFJ to efficiently leverage its strength in the Americas and deploy capital into high-quality assets, through the strong capital position and U.S. dollar funding capabilities of Union Bank.”

Besides the platform, the PB Capital team will be joining Union Bank, a group that Union Bank senior executive vice president Michael Stedman said “brings deep experience and strong relationships with marquee property owners that will provide tremendous expansion of our capabilities.”

According to the Mortgage Bankers Association, banks and thrifts hold 35% of commercial debt outstanding as of the end of 2012.