Are Bank United of Texas and its mortgage unit, Commonwealth United Mortgage, on the auction block? That's what some sources are saying.

Bank of America and Chemical Bank are eyeing the companies closely and are likely to bid, the sources say. First Interstate Bank of California is also interested, sources added.

The possibility of a sale was first reported in the Houston Chronicle last month.

No Comment

Bank United officials declined to comment. Spokesmen from Chemical Bank, First Interstate Bank, and Bank of America did the same or did not return phone calls.

It was unclear whether Lewis Ranieri, the chairman of Bank United, had sought to sell the bank or was approached.

Some observers say that Mr. Ranieri, a legendary trader who helped pioneer the mortgage-backed securities market, enjoys owning and operating Bank United and is not especially interested in selling out. But others aren't so sure.

"Lewie would sell it in a New York minute if he could get the right price," said one source.

Attraction for B of A

Bank United could be an attractive target for Bank of America for a number of reasons. "First it would give them more thrift offices in Texas," one source said. "But also, B of A has been known to be looking to expand its mortgage operations outside of California."

Similarly, Chemical Bank and First Interstate are keen to gain the mortgage division as well as the thrift assets, sources said.

The thinking in Texas mortgage banking circles is that interest in bidding may well widen once other potential acquirers form a clearer idea of the value, said one executive.

Expertise Seen Needed

Only a large and sophisticated investor is likely to get involved, sources said. In addition to the thrift offices and mortgage division, Bank United of Texas has a large mortgage warehouse lending program and a securitization unit

"I'd think it would have to be someone with warehouse lending expertise, if you were going to go in and evaluate and manage those assets," said a banker.

The securitization unit, which has made a profitable business out of buying and repackaging loans from the Resolution Trust Corp. and others, would be a difficult asset to value, sources said.

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