The parent company of California's 10th-largest commercial bank has retained the services of New York investment banking firm Lehman Brothers Inc. to evaluate the institution's future.

Imperial Bancorp, holding company for $2.8 billion-asset Imperial Bank, announced Jan. 11 that it is interested in "evaluating strategies to maximize shareholder value."

Options for Imperial, which has 10 offices in California, include selling, merging, or expanding existing services. A sale for Imperial, based near Los Angeles, has been speculated for more than a year. Its business-banking niche is considered valuable, despite Imperial's past asset quality problems.

Like many banks in Southern California, Imperial was hit hard by plunging area real estate prices during the past five years.

Asset size at Imperial dropped more than 8% in 1993 and nearly 14% in 1994.

The bank rebounded in 1995 and has grown 11.4% through the second quarter. Through September 1995, Imperial had an ROA of 0.85% and an ROE of 9.7%.

Profitability is also up at the bank, as Imperial registered a net gain of nearly $9 million last year, just two years after a $2.7 million loss.

Imperial officials could not be reached for comment.

Joseph K. Morford, analyst with Alex. Brown & Sons, in San Francisco, said he expects Imperial's announcement to attract attention within the industry.

"They have a very attractive franchise and a lot of unique business niches that they focus on," he said.

He added that Imperial's decision doesn't necessarily foretell a takeover. Imperial, largely a business bank with a strong retail distribution network, would likely require a "unique buyer," possibly a foreign entity.

"They're facing a couple of issues," Mr. Morford said. "They recently had a memorandum of understanding lifted, so they're now a little more free to consider methods of leveraging capital, and they're operating in a consolidation environment."

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