Orange County Register

CapitalSource Inc., an investor and lender, said Tuesday federal regulators approved its planned purchase of $5 billion in deposits and 22 branches of Brea-based Fremont Investment & Loan.

The deal still has a hurdle or two left, however.

Fremont General, the parent of Fremont Investment & Loan, said in May it likely would file for Chapter 11 bankruptcy to facilitate the sale of its deposits, if the sale was approved by the Federal Deposit Insurance Corp. One reason to file bankruptcy: Fremont doesn’t believe it could put together all the documents necessary to solicit shareholder votes on a sale.

The company said then the bankruptcy will not affect the federally-insured deposits of its clients as long as their total accounts are worth less than $100,000.

Fremont also previously said it reached an agreement with Litton Loan Servicing LP, an affiliate of Goldman Sachs & Co., to take over servicing of its $12.2 billion loan portfolio.

Related news:

• Fremont expects to file for bankruptcy
• Regulators give Fremont 60 days to raise capital or sell bank
• Fremont’s woes mount
• It still pays to be a mortgage executive
• That didn’t take long
• O.C. foreclosures hit new record in May, break 1,000 in a month for first time
• 1st drop in ‘08 for O.C. distressed homes for sale
• Orange County’s mortgage market distress could soon top the U.S.

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