Truist Bank is selling Regional Acceptance, its near-prime auto finance operation.

Truist confirmed the move involving a $5.5 billion portfolio in a filing with the Securities and Exchange Commission on Tuesday, with the institution expecting the transaction to close late in the third quarter or early in the fourth quarter of this year.

According to the SEC filing, Truist hopes to gain $5.2 billion of net proceeds and a $535 million loan loss reserve recapture through the deal involving Regional Acceptance, which previously operated as a division of BB&T.

BB&T and SunTrust completed a merger at the end of 2019 to form Truist.

The bank said Regional Acceptance’s pre-tax earnings were approximately breakeven through the first six months of this year.

Truist explained that beyond the net proceeds, the disposal of Regional Acceptance should accomplish multiple objectives, including:

—Sharpens strategic focus

—Exits non-core, less profitable near prime auto lending

—Consistent with prior actions (discontinued marine and RV financing)

—Strengthens balance sheet

—Enhances liquidity and funding profile

—Maintains capital strength and flexibility

—Improves credit risk profile

—Strengthens resilience across stress environments

—Enhances shareholder value

—Modestly accretive to earnings and tangible book value

—Improves capital efficiency

Truist added in the filing that it plans to repay wholesale borrowings with proceeds from loan sale and reposition certain AFS securities to fully offset capital created from the transaction.

Bill Jones, who was the chief executive officer and president of Regional Acceptance at the time, was the 2019 Auto Finance Executive of the Year, presented by Black Book.