The transaction, creating a true rival to Citigroup, is contingent on approval from the Justice Department and the Federal Reserve, though legal experts said they did not expect the merger to be blocked, the New York Times said.
The merger would unite the investment and commercial banking strength of J.P. Morgan Chase, the product of a merger of Chase Manhattan and J.P. Morgan in 2001, with Bank One's much larger consumer banking operations. The combined company would have 2,300 branches in 17 states.
With the addition of Bank One, based in Chicago, J.P. Morgan, the nation's second-largest bank, would have $1.1 trillion in assets, compared with nearly $1.2 trillion for Citigroup.
Bank One's chief executive, James L. Dimon, will become J.P. Morgan's president and chief operating officer. The combined banking concern would be based in New York.