There's nothing like a battered regional economy to whet the appetite of Lewis S. Ranieri.

In 1988, the mortgage securities pioneer braved the Texas bust by purchasing a savings and loan in Houston. Now, with Texas recovering, Mr. Ranieri is guiding his thrift, United Savings Association of Texas, into distressed New England.

United Savings announced this week that it will buy the originations business of Commonwealth Mortgage Co., a Burlington, Mass., lender that filed for bankruptcy protection on Monday. Commonwealth wrote $1.2 billion of loans in the 12 months through April, almost one-fourth of United's output last year.

A Familiar Ring

Over the past several days, Mr. Ranieri said, he's been hearing echoes of 1988. Back then, he recalled, people wanted to know "why I was crazy enough to go into Texas."

Mr. Ranieri, a former vice chairman of Salomon Brothers Inc., says the real question is why not enter New England.

"I think that, long term, New England is a viable and potentially vibrant economy," he said in an interview. "If not on the upswing, its certainly very close to it."

$6 Billion in Loans Expected

The Commomwealth deal, which is subject to bankruptcy court approval, would add 12 loan offices to the 56 that United already operates in 18 states.

Mr. Ranieri said his network wrote $4 billion of loans last year and expects to hit $6 billion this year, even without the New England purchase.

Commonwealth, which is privately held, filed for Chapter 11 bankruptcy protection after the Federal National Mortgage Association revoked its status as an approved seller and servicer of loans.

A Commonwealth spokesman called the Fannie Mae action "a consequence of financial difficulties resulting from foreclosures."

The mortgage company had sold a number of its loans to the secondary market with "recourse," meaning it retained liability for foreclosure losses.

Past as Prologue

While terms of United's proposed acquisition are still in flux, a court document suggests that the thrift will pay at least $750,000. In the meantime, United has received court clearance to start funding mortgage applications already approved by Commonwealth.

Mr. Ranieri is betting that he'll be as prescient about new England as he was about Texas.

"I view New England as being very much like Houston," Mr. Ranieri said. "Houston got its head knocked off, and then picked itself up from the ground and put itself back together. Today I would tell you it's one of the most vibrant economies in the United States."

John Brinton, formerly head of mortgage originations at California's Security Pacific Corp., is taking a similar post at Albany, N.Y.-based KeyCorp.

Starting next week, Mr. Brinton will run retail originations in KeyCorp Mortgage's nine-state market, a company spokesman confirmed. Mr. Brinton was assigned to a less senior originations post at BankAmerica Corp. after it merged with Security Pacific Corp. in April.

In a related move, Jack Daly, Mr. Brinton's boss at Security Pacific, has joined forces with veteran mortgage consultant Jim Pratt. Their new San Diego-based company, Pratt Daly Corp., plans to advise mortgage lenders on management and sales issues, Mr. Daly said.

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