BankBoston to Sell Stake in HomeSide, Inc.; National Australia Bank To Acquire HomeSide.

BOSTON, Mass.--(BUSINESS WIRE)--Oct. 27, 1997 -- BankBoston Corporation (NYSE:BKB) today announced plans to sell its 26% ownership interest in HomeSide, Inc., an independent mortgage banking company, to the National Australia Bank. The sale of BankBoston's ownership interest is in connection with an agreement which calls for National Australia Bank to acquire 100% of HomeSide. The transaction, which is subject to regulatory and HomeSide shareholder approval, is expected to close in the first quarter of 1998.

HomeSide was formed in the first half of 1996 by two equity investment firms, Thomas H. Lee Group and Madison Dearborn Partners, BankBoston and Barnett Bank. BankBoston and Barnett each sold its respective mortgage subsidiary to HomeSide retaining an equity ownership interest. Earlier this year a portion of HomeSide was sold to public shareholders. HomeSide now services approximately $97 billion of mortgages, ranking seventh nationwide. Its servicing portfolio has more than doubled since the formation of the company.

BankBoston expects to record a pre-tax gain of approximately $170 million upon consummation of the sale to National Australia Bank. This will be in addition to a pre-tax gain of more than $100 million which BankBoston recorded upon the initial sale of its mortgage banking subsidiary in early 1996.

Commenting on today's announcement, BankBoston's CEO Chad Gifford said, "HomeSide has proven to be a home run for BankBoston's shareholders. The unique partnership arrangement allowed the company to grow and achieve the scale necessary to be a major player in the mortgage banking industry. We will continue to look for innovative ways to create value for our shareholders as we continue to focus on and invest in those businesses where we enjoy a competitive advantage."

BankBoston (NYSE:BKB), with assets of $68.2 billion as of September 30, 1997, was founded in 1784 and is the 15th-largest bank holding company in the United States. BankBoston is engaged in: consumer banking in southern New England; financing to selected corporations regionally, nationally and internationally; and full-service banking in key Latin American markets. The Corporation and its subsidiaries operate through a network of offices in the United States and through more than 100 offices in 23 countries in Latin America, Europe and Asia, the third-largest overseas network of any U.S. bank. The Corporation's common and preferred stocks are listed on the New York and Boston stock exchanges.

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