IRVINE, Calif. — Consumer Portfolio Services announced Monday that it has entered into an agreement with Fireside Bank to purchase a $237 million portfolio of performing automobile receivables.

Fireside Bank is a wholly owned subsidiary of Unitrin Inc. 

A subsidiary of CPS is to acquire and hold the receivables. The closing of the transaction, which is subject to regulatory approvals and the satisfaction of customary closing conditions, is expected to occur during the third quarter, according to management.

Back in March 2009, Fireside announced it was exiting the auto lending business.

At that time, Don Southwell, Unitrin's chief executive officer, said, "The decision to exit the automobile finance business was an extremely difficult one. Fireside Bank has been an important contributor to our profits over the years, and Fireside's management has done a terrific job of adapting to unprecedented economic and market conditions.

"However, the turmoil in the economy, coupled with the changes in the used-car marketplace and increased capital requirements, has led to this decision," he continued. "In an era of scarce capital resources for all financial institutions, Unitrin's management and board of directors believe that it is in the best interests of Unitrin's shareholders to redeploy its investment in Fireside in order to reduce the overall risk profile of Unitrin and to provide Unitrin with enhanced liquidity and access to additional capital resources."

Fireside, based in Pleasanton, Calif., had engaged exclusively in the financing of vehicles through the purchase of retail installment contracts from dealers. The borrowers under contracts purchased by Fireside typically had marginal credit histories.