Monday, April 13, 1998
The Associated Press
NEW YORK -- BankAmerica Corp. has agreed to merge with NationsBank Corp. to create one of the the biggest banks in the nation and become the first coast-to-coast bank, according to published reports. A second deal would create the fifth-largest banking company in terms of assets by combining Banc One Corp. with First Chicago NBD Corp, a merger that would be dominant in the Midwest.
Both deals were to be announced today in New York, The New York Times reported today.
The expected deals come a week after Citicorp and Travelers Group Inc. said they would merge to create the world's largest financial-services company. Banking industry analysts said the deal would put more pressure on other companies to merge in order to compete.
Two spokesmen for BankAmerica refused to comment on the reports to The Associated Press. Messages left Sunday night for NationsBank, Banc One and First Chicago were not returned to the AP.
The merger of BankAmerica and NationsBank would be worth $60 billion and give the combined banks $570 billion in assets, The Wall Street Journal reported Monday on its Web site.
The deal would bring the banks to 24 states and Washington with nearly 5,000 branches and about 15,000 automated-teller machines, the Journal reported.
The merger would create the largest bank in terms of total branches and deposits, the Times said. The combined corporation would be the naton's second-largest bank holding company in terms of total assets.
NationsBank is based in Charlotte, N.C., and covers the Southeast to Maryland. BankAmerica spreads east from its San Francisco base. Both firms have operations in Texas.
The combination of NationsBank and BankAmerica is expected to be run for about two years by Hugh McColl, NationsBank's 62-year-old chairman and chief executive, before BankAmerica's 50-year-old chairman and chief executive, David Coulter, takes over, people familiar with the matter told the Journal.
The deal would complete the ambitions of McColl, who has worked to turn NationsBank into one of the nation's largest banks through aggressive acquisitions. He has long sought to link his bank with the Pacific.
NationsBank is the third biggest banking company, with $310 billion in assets.
The deal between First Chicago and Banc One, of Columbus, Ohio, has an estimated value of $30 billion in stock, people close to those talks told the Times.
First Chicago shareholders would receive 1.62 shares in a new company, which will keep the Banc One Corp. name and will be based in Chicago, for every share they own, the Times reported. Banc One shareholders will get one share of the new company for every share they own.
About 60 percent of the combined company will be owned by Banc One shareholders. The balance will be owned by First Chicago shareholders. Verne G. Istock, First Chicago's chairman and chief executive, is expected to be named chairman of the new company. John McCoy, chairman and chief executive, is expected to be named president and chief executive.
