Tuesday April 25, 8:04 am Eastern Time
Company Press Release
SOURCE: Charles Schwab & Co., Inc.
Schwab, E-LOAN Announce Alliance to Make Mortgage Products Available to Schwab Customers Online
Service to Be Available in June, Offering Customers a Complete Online Mortgage Solution, Including the Ability to Research, Compare and Apply for a Mortgage Loan Online at www.schwab.com, and Then Track and Close Their Loan
SAN FRANCISCO, April 25 /PRNewswire/ -- Charles Schwab & Co., Inc., the nation's fourth largest financial services company and the world's leading online broker, and E-LOAN, Inc. (Nasdaq: EELN - news), a leading online lender and loan broker, today announced an alliance to make E-LOAN a mortgage provider to Schwab customers via its Web site at www.schwab.com.
Under the agreement, which has a four-year term, retail Schwab customers and prospects will have access to E-LOAN's broad choice of mortgage products from more than 70 lenders, as well as online rate search, loan comparison and selection, application and loan tracking services. The full array of products and services will be offered in June to customers and prospects at schwab.com using E-LOAN's proprietary technology. E-LOAN will dedicate customer service representatives to provide personalized service to each borrower from application to close. In the future, the two companies may also provide access to additional customized loan products and debt management tools specifically designed by E-LOAN for Schwab customers and prospects.
``For many of our customers, a home is the largest single investment they will ever make,'' said Charles R. Schwab, Chairman and Co-CEO of The Charles Schwab Corporation. ``Our alliance with E-LOAN will provide customers with a convenient way to shop for and compare low-cost home loan products right from our Web site. It puts them in control and gives them the tools to confidently find the right mortgage for their particular circumstances.''
``In choosing E-LOAN to be their mortgage provider, Schwab has recognized the strength of our customer-focused model,'' said E-LOAN CEO Chris Larsen. ``The Schwab brand stands for consumer choice and quality service, and we're thrilled to support that through our mortgage offering. Through this alliance, we will have many more opportunities to continue revolutionizing the mortgage lending process and developing high-value products and services for Schwab customers.''
``We performed extensive research that showed a significant number of our customers would seek a mortgage if it was available via schwab.com,'' said Daniel O. Leemon, Schwab executive vice president, Business Strategy. ``After an exhaustive review process involving nine companies, E-LOAN emerged as the best provider. They are a company with a commitment to customer service, superior technology, a choice-based business model with a breadth of products, and a strong management team.''
As part of the agreement, Mr. Leemon, a member of the Charles Schwab Corporation's Management Committee, will be nominated to E-LOAN's board of directors. In addition, E-LOAN will grant Schwab warrants totaling 13.1 million shares in 2 tranches. The first tranche consists of 6.5 million shares, has a three-year term, and is exercisable at a strike price of $3.75 per share, subject to certain exercise provisions. The second tranche consists of 6.6 million shares, has a 3 1/4 year term, and is exercisable at a strike price of $15 per share. Both tranches of warrants are subject to certain lock-up provisions. Separately, Schwab and four other firms have agreed to acquire equity stakes in E-LOAN. |
