Washington Mutual OKs $1.5 Billion Buyout of Bank United

Washington Mutual Inc., the nation’s largest thrift, has agreed to acquire Bank United Corp. for approximately $1.5 billion, giving Washington Mutual a significant presence in Texas.

Washington Mutual, a Seattle-based institution, will pay stockholders of Bank United 1.3 shares of Washington Mutual stock for each of share they own in Bank United. The proposed transaction must be reviewed by federal banking regulators and approved by Bank United stockholders before it is completed.

Houston-based Bank United is the largest publicly traded banking organization based in Texas. As of June 30, Bank United operated a 155 branches in the Lone Star State, including 66 branches in the greater Houston area; 77 in the Dallas/Fort Worth area, five in Midland, four in Austin and three in San Antonio.

“This transaction gives Washington Mutual the critical mass to capitalize on the outstanding growth potential of the Texas market,” says Kerry Killinger, Washington Mutual’s chairman, president and CEO. “It’s a logical extension of our strategy to become the leading consumer bank in the nation’s most attractive geographic markets.”

Washington Mutual has 1,046 retail branches and assets of about $186 billion. Bank United has assets of $18 billion. In the first nine months of its fiscal year ending June 30, Bank United generated earnings of $98.3 million, or $2.77 per diluted share, up 17% from $78.2 million, or $2.37 per share comparable period of last year. Bank United has approximately $8.8 billion in deposits.The transaction is expected to close in late 2000 or early 2001. Lehman Brothers is acting as financial advisor to Washington Mutual; Goldman Sachs as financial advisor to Bank United.