Commonwealth Bank eyeing BankWest

SYDNEY (Reuters) - Commonwealth Bank of Australia (CBA) (CBA.AX), the country's No. 2 bank by assets, may offer over A$6 billion (2.8 billion pounds) to HBOS HBOS.L for its Australian unit BankWest, the Australian newspaper reported on Monday.

CBA declined to comment on the report.

HBOS, Britain's biggest mortgage-lender, has appointed Morgan Stanley to advise on future options for the west Australian-based lender, which is worth A$5 billion to A$7 billion, the newspaper said, citing banking sources.

But a CBA source told Reuters no formal process was underway. "If we were doing any deal like that then we would have appointed outside advisers," a CBA source said.

Morgan Stanley also declined comment.

The plan comes after CBA last week withdrew from acquisition discussions with Royal Bank of Scotland (RBS.L) to acquire ABN AMRO Australia, the paper said.

CBA Chief Executive Ralph Norris said in a television interview on Sunday that his bank would continue to look for acquisition opportunities.

"You always look at acquisitions and it's about how compelling the acquisition opportunity is. Certainly, we would look at all opportunities. We have done that in the past, and we will continue to do so in the future," Norris said.

Any Commonwealth bid would face few competition or regulatory hurdles, the newspaper report said.