Newspaper article THE JOURNAL RECORD

CoreStates, First Union Agree to Merge

Newspaper article THE JOURNAL RECORD

CoreStates, First Union Agree to Merge

Article excerpt

PHILADELPHIA (AP) -- CoreStates Financial and First Union have agreed to a $16.1 billion merger, an acquisition that would represent the largest in U.S. banking history and the latest in a frenzied consolidation of the financial world.

The merger would create a financial giant with $204 billion in assets and 2,600 branches serving 16 million people in 12 states from Florida to Connecticut. The corporation would be the nation's sixth largest banking company and would have the largest share of retail deposits on the East Coast.

Philadelphia would become the new company's corporate banking center as well as a major base for the bank's customer service operations. First Union said it expects to bring about 3,000 jobs to the Philadelphia area, and the city would become headquarters for operations in Connecticut, New York, Delaware, New Jersey and Pennsylvania. The jobs would "significantly offset the impact of merger-related job reductions," the companies said in a statement. But spokeswomen for both companies would not say Tuesday how many people could lose their jobs. "We are particularly pleased that First Union is demonstrating an unwavering commitment to the growth and vitality of the region CoreStates serves," said Terrence A. Larsen, CoreStates chairman and chief executive officer. "Our combined organization will enable us to leverage our expertise, products and customer relationships in a powerful new way. Together, we will be unbeatable," he said. First Union has agreed to exchange 1.62 shares of its common stock for each share of CoreStates common stock. If shareholders and regulatory agencies approve the agreement, Edward E. Crutchfield, chairman and chief executive officer of First Union, would retain his duties with the new company. Larsen would become vice chairman and John Georgius would remain First Union's president. The merger would eclipse the nation's previous largest, NationsBank $14.6 billion proposed purchase of Barnett Banks. …

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