Major bank Mergers announced in 1995
Acquiror/acquiree
First Union/First Fidelity
First Chicago/NBD
Fleet/Shawmut
PNC/Midlantic
US Bancorp/West One
NAB/Michigan National
Boatmen’s/Fourth financial
Transaction Value ($Bn)
Book
5.4 1.9x
5.3
3.7
3
1.6
1.9
1.8
Price To
Market
1.3x
1.5
1.8
2
2
1.2
1.1
1.1
1.5
1.3
1.4
Geographic Markets Served by the Top 50 U.S. Banks, by Assets (billions of dollars)
West
BOA
Wells
US Bancorp
bancorp Hawaii
Midwest
First Chicago/NBD
Banc One
Norwest
KeyCorp
National City
First Bank System
Comerica
First of America
Huntington
Firstar
Fifth Third
Mercantile
Old Kent
115
96
74
65
49
37
35
23
20
19
19
18
12
South
NationsBank
First Union
Sun Trust
Wachovia
Barnett
SouthTrust
Southern National
AmSouth
Mercantile
Crestar
First Tennessee
Union Planters
Central Fidelity
Comparative Market Share Data: Other Businesses (dollar
amounts in $
billions)
Bank Mutual Fund Assets Under Management
Rank (march
Servicing
31,1995)
Mellon
1
$68.00
PNC Bank
2
22.4
NationsBank
3
14.7
Wells Fargo
4
10.6
Chase
10
7
Chemical
13
5.7
Loan Syndications - Agent Only(first halfRank
1995)
Chemical
J.P. Morgan
Citicorp
BankAmerica
Chase
NationsBank
First Chicago
Bank of New York
Bankers Trust
Bank of Nova Scotia
Rankings for 1994)
New York 9 County Consumer Share
Deposit Share
Rank
Share
1
14%
3
6%
2
13%
4
4%
5
3%
N.R.
N.R.
1995 interest rates comparison
Avg. US rates Paid or charged
Deposit rate
Credit card loan rate
Small business loan rate spread
Aggreagte Amounts
outstanding for Banks Banks
Main competitors
$453
2.71%
5.05%
240
16.00%
14.00%
300
6.00%
3.00%
Comparables analysis, December 31, 1994( dollar amnts in Mn)
Chemical Chase
BankAmerica
Nationsbank
First Union Banc One J.P. Morgan
Income Statement Data
Interest Income
9,088
8,134
12,384
10,529
5,095
6,437
8,379
Non-interest Income
3,597
3,053
4,147
2,597
1,159
1,420
3,536
Interest Expense
4,414
4,445
4,842
5,318
2,061
2,249
6,398
Non-interest Expense
5,509
4,472
7,512
4,942
2,677
3,847
3,692
Net Income
1,294
1,205
2,176
1,609
925
1,005
1,215
EPS (incl. extraordinry income and charges)
4.64
5.87
5.33
6.12
5.22
2.42
6.02
Performance Ratios
Return on Average Assets
0.78%
1.01%
1.08%
1.02%
1.27%
1.15%
0.70%
Return on Average Common Equity12.32%
15.79%
13.20%
16.10%
17.04%
13.35%
12.90%
Efficiency Ratio
63.00%
66.33%
64.27%
62.54%
62.47%
64.60%
66.92%
Non Performing asstes as % of total assets
0.66%
1.03%
0.67%
0.72%
0.52%
0.14%
Balance Sheet Data
Data
Total Assets
171,423 114,038 215,475 169,604
77,314
88,923 154,917
Total Loans
78,767
63,038 137,222 103,371
53,051
61,096
20,949
Total Deposits
96,506
69,956 154,394 100,470
58,958
68,090
43,085
Total Liabilities (Total Debt)
160,711 105,679 196,584 158,593
71,916
81,358 145,349
Risk based Capital Ratio - Tier 1
8.20%
8.30%
7.27%
7.43%
7.76%
9.93%
9.60%
- Total
12.35%
12.78%
11.69%
11.47%
12.94%
13.33%
14.20%
Market Data
Common Stock - High
42.13
40
50.25
57.38
47.63
44.73
79.38
Price - Low
33.63
30.38
38.38
43.38
39.38
24.13
55.13
Number Shares, year end (in Mn)
244.5
181.2
371.2
276.4
176
396.9
187.7
Market value/share
35.88
34.38
39.5
45.13
41.38
25.38
56.13
Book value/share
37.88
39.28
42.63
39.43
30.66
18.43
46.73
Market-to-book ratio
94.72%
87.51%
92.66% 114.44% 134.95% 137.71% 120.10%
Other
Headquarters (City/State)
New York, NY
New York, NY
San Francoisco,
Charlotte,
CA NC
Charlotte, NC
Columbus, OH
New York, NY
Employees
42,130
35,774
98,600
61,484
31,858
48,800
17,055
J.P. Morgan
New York, NY
Estimated
Impact
of
Merger
between
Estimated reduction in non interest Expense
Target Bank
Chase
BankAmerica
NationsBank
First Unionc
Banc One
J.P. Morgan
As % of Target's Premerger
Expenses
$ Millions
$1,500
655
539
185
350
587
34%
13
10
7
10
15
Chemical's
ownership at
Impact on
Current Market Chemical's
Price of
EPSb
59%
31%
40
8
45
9
60
3
51
-1
50
-2
Chemical and selected banks
Impact on Target's EPSb
44%
12
10
7
18
34
Targeted Merger Saves, Pre Ta (Dollar amounts in $ millions)
Planned Saves as % of combined Expense
base
GlobalBank
19%
GlobalServices
12%
Tri-StateRegional
16%
NationalColnsumer
16%
TCB(Texas)
0%
TotalRegional&NationalConsumerBusiness
13%
CentralInformationTechnology&Operations
25%
Corporate Functions
29%
Miscellaneous
Total
18%
SavesasPercentofSmallerBase(Chase)
38%
OneTimePre-TaxRestructuringCharges
RelatedExpenses
Total
Income Statement Data
1994
1993
Interest Income
9,088
8,403
Non-interest Income
3,597
4,024
Interest Expense
4,414
3,767
Non-interest Expense
5,509
5,293
Provision for Loan losses
550
1,259
Net Income
1,294
1,604
Restructuring Change
308
158
EPS (incl. extraordinry income and
4.64
charges) 5.63
Performance Ratios
Return on Average Assets
0.78%
1.11%
Return on Average Common Equity
12.32%
16.66%
Efficiency Ratio
63%
58%
Non Performing asstes as % of total
0.66%assets 2.35%
Balance Sheet Data
Total Assets
171,423
Total Loans
78,767
Total Deposits
96,506
Total Liabilities (Total Debt) 160,711
149,888
75,381
98,277
138,724
139,655
82,010
94,173
129,084
138,930
84,237
92,950
131,649
73,019
45,131
48,951
69,112
71,513
44,512
50,151
67,808
Market Data
Common Stock Price, year End 35.88
40.13
38.63
21.25
10.75
29.88
41,567
39,687
43,169
26,689
29,139
Other
Employee
42,130
Income Statement Data
1,994
1,993
Interest Income
8,134
8,468
Non-interest Income
3,053
2,949
Interest Expense
4,445
4,605
Non-interest Expense
4,472
4,520
Provision for Loan losses
500
1,561
Net Income
1,205
966
Restructuring Change
0
205
EPS (incl. extraordinry income and
5.87
charges) 4.79
Performance Ratios
Return on Average Assets
1.01%
0.94%
Return on Average Common Equity
15.79%
14.59%
Efficiency Ratio
66.33%
66.35%
Non Performing asstes as % of total
0.60%assets 1.00%