It has been rumored for the past couple of months or so that J. P. Morgan Chase (NYSE: JPM) has been pondering the acquisition of downtrodden Washington Mutual (NYSE: WM) and may have had some preliminary discussions. I have been thinking that Wells Fargo (NYSE: WFC) might have more than a passing interest too.

I have had business dealings with all three financial companies, including stock ownership, loans, and multiple bank accounts. We have owned JPM stock in the past, but do not currently. We sold most of our WaMu stock last year but still own it in one account. We have never owned Wells, but of the three we would like to get into this one the most, at the right price, of course. I have written extensively about all three companies, so it is with more than a passing interest that I was thinking about M&A issues.

Chase and Wells both could make use of WaMu and gain financially but in different ways. Chase has a much bigger need to establish a presence on the West Coast. It has been expanding over time but its branch system is still weak compared to Wells and the other major banks. With its extensive branch system on the West Coast, WaMu would solve that problem fast.

Looking at Wells Fargo, which already has one of the largest foot prints west of the Mississippi, there is no real need for WaMu's retail outlets. On the other hand, there would be tremendous strategic advantage to WFC if they could prevent JPM from achieving its goals, or at least slowing it down.

In my view, Wells would have one other benefit that Chase does not. While both banks would love to gain Washington Mutual's customers, Chase would likely keep most of the retail branches and thus incur the cost of converting them. Wells on the other hand could probably shut down two thirds of the branches, sell the real estate and transfer the accounts to its closest branches. Wells has a lot of overlap that Chase does not.

If Wells bought out leases and sold off the commercial real estate, it would make the acquisition much more profitable. My sources tell me that the only negative would be the bad publicity associated with all the layoffs that would occur during the reorganization. That may be so, but some of those layoffs might occur anyway as WaMu adjusts to its current, lower level of business. Despite the unpleasantries of staff reductions, this too would contribute to WFC's return on invested capital. This is something that shareholders and analysts alike would want to see.

Other banks like Wachovia Corp. (NYSE: WB) or Comerica Inc. (NYSE: CMA) might take a gander at WaMu for the same reasons as Chase, but I think they have enough on their plates already, and are not currently positioned for such a large deal.

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. Disclosure: I own shares of WM.