$1 BILLION BANK BUY PROPOSED NY FIRM EYES TEXAS GIANT.(Main)

Byline: David Satterfield

In one of the nation's biggest banking mergers ever, Chemical New York Corp. agreed Monday to pay nearly $1.1 billion for struggling Texas Commerce Bancshares, the Lone Star State's third largest banking firm.

Chemical, the nation's sixth largest bank holding company, said it will pay an estimated $36 in cash and securities for each share of Houston-based Texas Commerce, which has assets of $19 billion.

Texas Commerce stock closed Monday at $27.25, up 75 cents. The stock had risen $2.75 Friday. Chemical's stock closed Monday at $43.50, down 87 cents. Both trade on the New York Stock Exchange.

The deal will make Chemical the nation's fifth largest banking firm, with assets in excess …