Chicago-based Unitrin to exit car-loan business, dismiss employees

Unitrin Inc. the Chicago-based insurer that makes subprime car loans, said it will exit the auto-financing business.

Unitrin will incur costs of as much as $16 million related to dismissing employees and ending office leases at the lending unit, the firm said today in a statement.

The exit comes after company's Fireside Bank subsidiary posted an after-tax net loss of $22 million in 2008, according to Moody's Investors Service in a March 13 statement. The unit "suffered significant losses in 2008 and 2007" and more were expected, Fitch Ratings said in February.

Unitrin isn't commenting on the number of jobs that may be cut, spokesman David Bengston said in an interview today.