agreed to sell a unit that makes installment and real-estate loans mostly in small towns to
for $1.25 billion in cash.
The segment, Washington Mutual Finance, runs about 400 offices in the Southeast and Southwest and had total assets of $4.1 billion at Sept. 30. It used to be called Aristar and was included in the company's 1997 acquisition of Great Western Financial.
WaMu said Washington Mutual Finance's mostly "smaller-market geographic focus differs from the parent company's strategy of targeting larger urban and suburban markets." The company said its existing guidance incorporates a gain from the sale. According to Thomson First Call, Washington Mutual is expected to earn $1.14 a share in the current quarter.
Washington Mutual shares were down 30 cents, or 0.4%, at $46.25 on the Instinet premarket session. The stock was downgraded Tuesday by UBS based on valuation, although the brokerage also raised its price target to $51.