Magazine article American Banker

Boatmen's to Buy Mortgage Lender

Magazine article American Banker

Boatmen's to Buy Mortgage Lender

Article excerpt

Boatmen's Bancshares, pushing aggressively into the home loans, is planning to buy Memphis-based National Mortgage Co. for about $155 million in stock.

The agreement, announced Friday, is the latest in a series of mortgage-related acquisitions by commercial banks. These banks have come to view mortgage lending as a cornerstone of their consumer-banking strategies

Boatmen's, based in St. Louis, plans to use National Mortgage to support increased lending at its 400 banks branches, which are spread over nine states.

"We have a large consumer banking franchise and it's been given a lot of strategic emphasis -- the mortgage piece was the missing area," said James W. Kienker, chief financial officer.

$13 billion of Loans

National Mortgage is a major mortgage servicer, processing monthly payments on some $13.1 billion of loans.

That operation should give Boatmen's economies of scale in servicing the loans its branches produce.

Indeed, the acquistition is expected to make the banking company one of the top 30 servicers nationwide. Right now, it doesn't even rank among the top 100.

Other Major Buyers

National Mortgage, a privately held company, is also an active loan originator. Last year, it wrote $1.7 billion of mortgages, eclipsing the $1.2 billion originated by Boatmen's.

"They have orginations technology and processes that we would like to import to some of our branches," Mr. Kienker said.

Boatmen's, which has assets of $27 billion, joins a growing list of banks that have been snapping up mortgage companies this year. …

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