INDIANAPOLIS -- American Fletcher Corp. and Banc One Corp. Monday completed the 10th-largest U.S. bank merger ever and said the aim of the surviving institution is to acquire more banks.
'Our game plan is to acquire as many banks as the law permits,' said Frank McKinney, chairman of the former Indianapolis holding company and now president of Banc One. 'The only thing that holds us back is the law, not the market.'
Indiana law prohibits a single firm from owning more than 11 percent of Indiana bank deposits. That figure increases to 12 percent July 1.
The acquisition of American Fletcher Corp. gave Banc One five more banks and $4.5 billion is assets, making it the largest owner of Indiana banks.
McKinney would not say whether the firm would acquire many small banks or settle on one large deal.
'That is a strategic question and I'm sure our competitors would like to know the answer,' said McKinney, who will be chairman of both Banc One, Indiana Corp., and Bank One, Indianapolis.
American Fletcher's afflilate banks, located in Carmel, Franklin, Plainfield and Elkhart, also will adopt the Bank One name, a move expected to cost as much as $1.3 million, McKinney said.
Banc One, Indiana Corp., could be offering more student-loan products, a strength of the firm in Ohio, said John McCoy, Columbus-based Banc One's chairman and chief executive.
Under the merger agreement, which was an exchange of stock based on Banc One's closing price Monday, American Fletcher shareholders will receive 2.1505 shares of Banc One stock for each Fletcher share. The deal is valued at $552 million based on Banc One's $26.25-per-share close on the New York Stock Exchange.
American Fletcher, Indiana's second largest bank, will become a subsidiary of Banc One and will be known as Banc One Indiana Corp. All of American Fletcher's subsidiaries will adopt some form of the Banc One name.
With American Fletcher's $4.5 billion Banc One has $17.4 billion in assets and $13.4 billion in deposits.