Old Stone Sells Subsidiary

PROVIDENCE, R.I. - Old Stone Corp., which has been selling assets to shore up its sagging fortunes, announced yesterday it had reached agreement to sell a mortgage subsidiary in Walla Walla.

Meridian Mortgage Corp. of Wayne, Pa., agreed to buy the Walla Walla-based Old Stone Mortgage Corp. The terms of the sale were not disclosed. The sale is expected to close during the first quarter of 1991.

Meridian, a subsidiary of Meridian Bank in Reading, Pa., will acquire Old Stone's $2.5 billion residential mortgage portfolio and its servicing operations in Walla Walla, Old Stone said.

Old Stone said it would retain its mortgage origination offices in six states in the West and Midwest, which it will continue to operate.

Old Stone has sold lending operations in California and a Seattle bank subsidiary since it announced a restructuring plan in September 1989. The latest sale was part of that plan.