Joe L. Allbritton, the majority owner of Riggs National Corp. in Washington, D.C., is selling a 55-year-old Texas bank to the nation's largest minority-owned bank.
Under the agreement, Houston-based University State Bank would be absorbed by International Bank of Commerce, the largest subsidiary of $3.3 billion-asset International Bancshares, Laredo.
No purchase price or other details were released, but the deal is "consistent with current market prices," said Dennis E. Nixon, president of International Bank and chairman of the holding company.
The $230 million-asset University State Bank, headquartered near Rice University, has five offices in Houston. Mr. Allbritton, chairman and chief executive officer of $5 billion-asset Riggs, has owned the Texas bank with his son, Robert, since 1976.
The deal would let International Bancshares expand into Houston proper. In February it broke into the Houston suburbs, buying five BankAmerica Corp. branches.
International also has developed a strong presence in the south Texas cities of Laredo, Brownsville, McAllen, and San Antonio.
"It's significant for IBC," said William Strunk, chairman of the Houston investment banking firm Strunk & Associates. "It gives them a foothold for other acquisitions and to grow this bank."
Mr. Nixon called Houston "one of the most important markets in the state," given that it is Texas' largest metropolitan area and has a "dynamic and aggressively expanding port."
Access to the Houston market would enhance International Bancshares' already significant business with international customers operating in Mexico and Latin America, he said.
"University is a trophy bank," Mr. Nixon said. "It offers us a very good point to operate from and expand our business from. It's just one of those natural expansions of our activities."
Mr. Allbritton, who usually shies from publicity, could not be reached to say why he chose to sell the Texas bank.
But Mr. Nixon, who called Mr. Allbritton a close friend, said the Riggs chairman has concentrated his attention on the Washington area since moving there and may be reorganizing his remaining Texas holdings.
Riggs has frequently been mentioned as a likely acquisition target, but Mr. Allbritton reportedly has refused to consider a sale.
The deal is expected to be completed by November.
