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Last Updated: Thursday, 15 January, 2004, 00:13 GMT
JP Morgan seals $60bn merger
JP Morgan flag
JP Morgan flies the flag
Wall Street legend JP Morgan Chase and US retail bank Bank One have announced plans to join forces.

The deal, which requires regulatory approval, would be the biggest financial sector merger in five years.

Worth some $60bn, the transaction would consolidate JP Morgan's position as the world's second biggest bank after Citigroup, owner of Smith Barney.

JP Morgan chief executive and chairman William Harrison would retain the same roles at the combined firm.

Bank One chief executive James Dimon would become president and chief operating officer, and would succeed Mr Harrison as chief executive in 2006.

Merger mania

The tie-up would give JP Morgan a foothold in retail banking, reducing its dependence on volatile equity markets and investment banking services.

Bank One, with assets of about $290bn, currently ranks as the sixth biggest bank in the US.

On Wall Street, Bank One shares surged by 10% in after-hours trade, while JP Morgan fell more than 4%.

According to press reports, the deal would be completed through a share swap, with Bank One investors exchanging each one of their shares for 1.3 shares in JP Morgan.

"It's a huge deal that's going to create a lot of rumours in bank land tomorrow," said Mark Fitzgibbon, banking analyst at Sandler O'Neill & Partners.

The JP Morgan - Bank One tie up comes three months after Bank of America and FleetBoston Financial announced their own merger.

That transaction, which is still awaiting regulatory approval, looks set to create the biggest consumer bank in the US.


SEE ALSO:
JP Morgan settles share inquiry
01 Oct 03  |  Business
US banking mega-merger unveiled
27 Oct 03  |  Business
US bank settles Enron claims case
02 Jan 03  |  Business
JP Morgan 'to wield jobs axe'
06 Oct 02  |  Business
JP Morgan Chase cuts 2,000 jobs
16 Oct 02  |  Business
Takeover talk hits JP Morgan
21 Oct 02  |  Business


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