Orders Issued under Sections 3 and 4 of the Bank Holding Company Act

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Banc One Corporation Columbus, Ohio

First Chicago NBD Corporation Chicago, Illinois

Order Approving Merger of Bank Holding Companies

Banc One Corporation ("Banc One"), a bank holding company within the meaning of the Bank Holding Company Act ("BHC Act"), has requested the Board's approval under section 3 of the BHC Act (12 U.S.C. [sections] 1842) to merge with First Chicago NBD Corporation ("First Chicago"). The resulting bank holding company would be named Bank One Corporation ("New Bank One") and have its headquarters in Chicago, Illinois. New Bank One would acquire control of First Chicago's subsidiary banks, including its lead bank subsidiary, First National Bank of Chicago, Chicago, Illinois ("First Chicago Bank"),(1) and retain control of Banc One's subsidiary banks. Banc One also has requested the Board's approval under section 4(c)(8) of the BHC Act (12 U.S.C. [sections] 1843(c)(8)) and section 225.24 of the Board's Regulation Y (12 C.F.R. 225.24) for New Bank One to acquire the domestic nonbanking subsidiaries of First Chicago.(2) In addition, Banc One has filed notices under section 4(c)(13) of the BHC Act (12 U.S.C. [sections] 1843(c)(13)), sections 25 and 25A of the Federal Reserve Act (12 U.S.C. [sections] 601 et seq., [sections] 611 et seq.), and the Board's Regulation K (12 C.F.R. 211) for New Bank One to acquire the Edge Act corporations and foreign operations of First Chicago.(3)

Banc One, with total consolidated assets of approximately $116.9 billion, is the eighth largest commercial banking organization in the United States, controlling approximately 2.5 percent of total banking assets of insured commercial banks in the United States ("total banking assets").(4) Banc One operates subsidiary banks in Arizona, Colorado, Illinois, Indiana, Kentucky, Louisiana, Ohio, Oklahoma, Texas, Utah, West Virginia, and Wisconsin. Banc One also engages in a broad range of permissible nonbanking activities nationwide.

First Chicago, with total consolidated assets of approximately $114.8 billion, is the ninth largest commercial banking organization in the United States, controlling approximately 2.3 percent of total banking assets. First Chicago operates subsidiary banks in Indiana, Illinois, Michigan, and Florida.(5) First Chicago also engages nationwide in numerous permissible nonbanking activities.

The proposal would create a combined organization that, after accounting for proposed divestitures, would be the fifth largest commercial banking organization in the United States. New Bank One would have total consolidated assets of approximately $231.7 billion, representing approximately 4.8 percent of total banking assets, and would have a significant presence in the Midwest.

Factors Governing Board Review of the Transaction

Under the BHC Act, the Board must consider a number of specific factors when reviewing the merger of bank holding companies or the acquisition of banks. These factors are the competitive effects of the proposal in the relevant geographic markets; the financial and managerial resources and future prospects of the companies and banks involved in the transaction; the convenience and needs of the community to be served, including the records of performance under the Community Reinvestment Act (12 U.S.C. [sections] 2901 et seq.) ("CRA") of the insured depository institutions involved in the transaction; and the availability of information needed to determine and enforce compliance with the BHC Act.(6) In cases involving interstate bank acquisitions, the Board also must consider the concentration of deposits in the nation and certain individual states, as well as compliance with other provisions of the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 ("Riegle-Neal Act").(7)

Public Comment on the Proposal

To give interested members of the public an opportunity to submit comments to the Board on the statutory factors that it is charged with reviewing, the Board published notice of the proposal and provided a period of time for public comment. …