National City Corp. may receive $6 billion to $7 billion from a group led by Corsair Capital to help the bank cope with losses tied to sub-prime loans, according to a person familiar with the matter.
The money would be used to boost the bank's capital, said the person. An announcement is expected to be made today, the person added.
The investors will pay $5 a share -- about 40% less than National City's closing price Friday -- and take ownership of about half the company's stock, the person said.
The bank joins lenders and securities firms including Citigroup Inc., Wachovia Corp. and Merrill Lynch & Co. that raised $163 billion to replenish capital after losses linked to sub-prime home loans. The world's biggest financial companies have disclosed more than $250 billion of write-downs and credit losses, according to data compiled by Bloomberg.