BANKING: Urge to Merge

For customers over the world the Chase Manhattan Bank last week printed 125,000 blotters showing a cartoon of two honeymooners driving off in a car tagged, “Just Merged!” It was the bank’s way of telling the public that the merger of the Chase National Bank (No. 3 in the U.S.) and the Bank of the Manhattan Co. (No. 15) had the official blessing of stockholders and the New York State superintendent of banks. Thus Chase Manhattan, with $7.5 billion in resources, became the biggest bank in New York City and second biggest in the U.S. (after California’s $9.2 billion Bank of America).

Last week another New York City bank completed a merger. National City Bank of New York ($6.3 billion in resources) took over the $713 million First National Bank, changed its name to the First National City Bank of New York, thus became the nation’s third biggest.

The urge to merge in New York is not over. This week the Bankers Trust Co. ($2.3 billion in resources) plans to take over the stock of the $564 million Public National Bank and Trust Co. (in a 1⅛ to 1 exchange), thereby pulling itself up from ninth to eighth place in the U.S. Biggest reason for the mergers: greater resources make it possible for a bank to make greater individual loans; more branches attract new customers and lower operating overhead.