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Washington Mutual buys HomeSide
Savings & loan purchases portfolio for $1.3B cash, $735M debt; sees buy accretive to 2002 earnings.
August 28, 2002: 10:06 AM EDT

NEW YORK (CNN/Money) - Washington Mutual Inc. said it will acquire the mortgage portfolio of National Australia Bank's HomeSide Lending unit for about $1.3 billion in cash and $735 million in debt.

Seattle-based Washington Mutual (WM: down $0.40 to $37.12, Research, Estimates) added that it expects the purchase to be modestly accretive to earnings in 2002 and to close in the fourth quarter the year.

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Under the agreement, Washington Mutual will buy HomeSide's parent company, SR Investment Inc., and its assets which include mortgage servicing rights on a mortgage portfolio worth about $131 billion.

National's foray into the U.S. mortgage lending business proved a disaster for the bank, which last year was forced to reduce the book value of Jacksonville, Fla.-based HomeSide by $2 billion.

Last December, National, also Australia's largest bank, sold HomeSide's mortgage business and all its operating assets, including its technology, infrastructure and employees, to Washington Mutual for $2 billion.

Under that deal, National retained HomeSide's mortgage portfolio.  Top of page


-- from staff and wire reports




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