Newspaper article THE JOURNAL RECORD

Banc One Ponders Charging Second Quarter Earnings to Pay for Changes

Newspaper article THE JOURNAL RECORD

Banc One Ponders Charging Second Quarter Earnings to Pay for Changes

Article excerpt

COLUMBUS, Ohio -- Banc One Corp. said it might charge second quarter earnings to pay for branch closings and other changes in how it sells financial products.

Now completing a years-long effort to consolidate operations in banks operating in 12 states including Oklahoma, Banc One said in its annual report that it will examine how best to reach customers. The review is scheduled to be completed in the second quarter.

"The outcome may include a variety of initiatives, possibly including consolidation of functions, installations or operations," the bank said in the report. The changes "could result in a charge to earnings, the magnitude of which cannot presently be determined." When Banc One officials met analysts last month in Phoenix, they didn't say how large the charge might be and were "vague" about which businesses could be consolidated, said bank analyst Anthony Davis at Dean Witter Reynolds. "It's my belief maybe 25 to 30 percent of its 1,500 branches could be replaced by alternative delivery channels," Davis said. "It's fair to say a charge of $150 million would be conservative." Banc One has also said it will take a $150 million charge related to its acquisition of credit card company First USA Inc., which the company expects to close during the second quarter. If the bank winds up taking a total charge of $300 million, it would reduce per-share earnings by 75 cents. The bank holding company also is buying Liberty Bancorp Inc. of Oklahoma City. Liberty shareholders Monday approved the proposed merger with Banc One. The merger, however, awaits regulatory approval from the Federal Reserve. The deal, valued at $544 million, would add 29 branches and $2.9 billion in assets to the Banc One organization. The multi-bank holding company currently operates Bank One, Oklahoma City, with $600 million in assets. Banc One on average is expected to earn 84 cents a share in the quarter, according to a Zacks Investment Research survey of 17 analysts. …

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