Banc One

In: Business and Management

Submitted By arashves
Words 1102
Pages 5
Financial Institution

Case One Banc One Corporation: Asset and Liability Management

Arash Ostad Ebrahim Vesaghi (Individual) Winter 2013

In 1993 the stock price of Banc One Corporation had dropped from about $45 at the beginning of the year to approximately $35 at the end of the year: roughly a 20% fall. This sharp decline in stock price greatly bothered John B. McCoy, chairman and CEO of Banc One Corporation. A high stock price was essential for Bank One’s strategic goal of continued acquisition by tendering its own stocks in each acquisition. The fall in stock prices put a damper on this drive for acquiring banks with potential for earnings and growth (it had 10 pending acquisitions worth $9 billion in November 1993). The lower their stock price drops, the more difficult it becomes for them to acquire other banks, thus threatening a major portion of the business and growth plans. They will need to either overhaul their asset and liability management or attempt to rapidly educate the public on the prudence of their business practices. Banc One used Interest Rate Swaps, the most common type of derivative instrument, to manage interest rate sensitivity. At these presentations, Richard Lodge, the chief investment officer, made clear that Banc One was not a dealer but an end-user of swaps. Lodge emphasized that the bank’s position was one of hedging and not of speculating. They first started using swaps in 1983, and subsequently, when the tax reform act of 1986 eliminated the advantages of municipal bonds as a tool for managing interest rate exposure, their dependence on swaps further increased. By 1993 the notional value of Banc One’s derivative portfolio had grown to $38 billion, a sum almost equal to half its assets. The amounts of Banc One’s swaps contracts depended on various factors such as: the loan demand, the slope of the yield curve, the amount of…...

Similar Documents

The One

...The One Minute Manager The objective of the book ‘The One Minute Manager’ by Kenneth Blanchard and Spencer Johnson is to define the effective managers in this dynamic world of business where various external and internal factors influence their performance. The One Minute Manager is good and powerful for anyone who has problems getting the most out of their staff. This book provides a useful model for opening up and stimulating the minds of everyone in the organization to accomplish more. The One Minute Manager provides a positive role model for the people managing his employees. The One Minute Manager is a remarkably simple system to learn and apply and will help you improve employee performance. It will make you feel that you are a better manager because you can be proactive rather than reactive by setting goals and providing quick feedback on performance whether good or bad. It will make your staff feel better about their work even those that receive a few ‘one minute reprimands’. They will finally know what is expected of them and through the reinforcement of praising and reprimands they begin to understand their role and the consequences. This book contains these three main ideas: One Minute Goal Setting, One Minute Praising and One Minute Reprimand which are the tools to develop an excellent manager. As we go on the story, the author started it with the young man searching an answer whose quest is to find managers who make both their organization and people with......

Words: 1372 - Pages: 6

The One

...proposition. At least one man asked why wait until the night. Another checked his mental calendar and said he couldn't today but what about tomorrow. Another who refused on account of being married apologized for having to refuse on account of being married. Meanwhile just half the men agreed to go out sometime. Extrapolating the finding to the real world means that on any given first date, the man would sooner sleep with the hostess than dine with his companion. The study seemed to confirm every stereotype anyone ever held about what men want (for the purposes of this article, what heterosexual men want). We want women. Now, please—although tonight will do. At worst tomorrow. We want them like that old Army poster with the finger pointing outward. We want you. We want you like we're all Uncle Sam, and dammit if the Germans aren't at it again. Pack up the lab equipment, please, shut off the lights, and move on to more important behavioral studies. Like finding out who drinks "lots of pulp" Tropicana. But the research did not stop there. What psychologists discovered is that underneath the simplicity, we men can be surprisingly complicated. We want women, yes, and we want sex. But we don't always want a slender frame and sharp curves. Sometimes we want a good personality. And a good romantic comedy. And to cuddle. This is laboratory science talking—not Hallmark or four martinis. And our motives for sex have diversified (as have women's)—a reality Hatfield now calls "one......

Words: 919 - Pages: 4

Banc One Case

...Banc One Corporation's CIO, Dick Lodge, had been using interest rate swaps to manage interest rate sensitivity since 1983. Later, when the tax reform act of 1986 eliminated the advantages offered by municipal bonds, Banc One's reliance on interest rate swaps increased. And by 1993, the notional value of Banc One's derivative portfolio had grown to $31.5 billion or more than 40% of Banc One's assets ($76.5 billion). Banc One had a strategic goal of acquiring other banks without being dilutive. The current problem facing Banc One is that its stock had fallen from $48.75 in April 1993 to $36.75 in November 1993 and was trading near the ‘walkaway' price of $34.55 in a deal to acquire Liberty National ($4.7 billion in assets). Banc One's stock price was approaching the point where the Liberty National deal could be dilutive. Equity analysts commented that the sizeable use of interest rate swaps had distorted earnings, earning assets, margins, and return on assets. All of this data is used to value the firm. In an effort to make investors feel more comfortable and to become more transparent to the market, Banc One should reduce the amount of risk it assumes, which at the same time will require less reliance on interest rate swaps. Like many regional banks, Banc One's balance sheet was asset sensitive. As a result, earnings were directly correlated with the rise and fall in interest rates. If Banc One wanted to manage its interest rate exposure without using swaps it could invest...

Words: 1500 - Pages: 6

No One

...Prepare Thoroughly Before You Begin Chapter 9 .......................Do Your Homework Chapter 10 .....................Leverage Your Special Talents Chapter 11 .....................Identify Your Key Constraints Chapter 12 .....................Take It One Oil Barrel At A Time Chapter 13 .....................Put the Pressure on Yourself Chapter 14 .....................Maximize Your Personal Power Chapter 15 .....................Motivate Yourself Into Action 2 Chapter 16 .....................Practice Creative Procrastination Chapter 17 .....................Do the Most Difficult Task First Chapter 18 .....................Slice and Dice the Task Chapter 19 .....................Create Large Chunks of Time Chapter 20 .....................Develop a Sense of Urgency Chapter 21 .....................Single Handle Every Task Putting It All Together 3 Preface Thank you for picking up this book. I hope these ideas help you as much as have helped me and thousands of others. In fact, I hope that this book changes your life forever. There is never enough time to do everything you have to do. You are literally swamped with work and personal responsibilities, projects, stacks of magazines to read and piles of books you intend to get to one of these days as soon as you get caught up. But the fact is that you are never going to get caught up. You will never get on top of your tasks. You will never get far enough ahead to be able to get to all those books, magazines and leisure......

Words: 20872 - Pages: 84

Bac One

...Banc One --- 1993 Case Study Bus 6611 Dr. Diane Eppler By April 2000 Banc One’s Mission, Objective and Strategies Mission – Banc One’s mission is to build shareholders value by sticking to the nuts and bolts. Banc One believed in the basics. The major objective was to create a perception of value and to focus on customer service. Strategies: Overall – The general strategies of Banc One is to be different than its peers; different in a good way. Banc One worked hard to develop a straightforward and simple strategy for continued success of their company. The Banc One overall target is being the best at managing opportunities, making affiliations work for everyone involved, create a perception of vale, and the development of human and financial capital. Marketing: _Product _- BancOne is in the business of Retail Banking. The bulk of Banc Ones business is providing loans to consumers and small-companies. Place – Banc One is headquartered in Columbus, Ohio. Banc One has over 1000 conveniently located branches throughout the U.S. States, currently located in 13 States. _Price _– Banc One pricing is slightly higher than it’scompetitors. Customer service is considered scarce in this industry and customers are willing to pay for superior service. Promotion – In the early 1960s Banc One hired a former disc jockey, John Fisher, todevelop Ad Campaigns for new retail products. John Fisher hired a then local comedienne, Phyllis Diller,...

Words: 2677 - Pages: 11

No One

... Janks Morton is a brilliant Black man and more people should look up to him as how he is trying to educate the people of color about themselves, especially the young and old black males. In this documentary he has went abound to the black community discussing the facts as to why the things that are happening are happening. It is not because they were raised wrong or simply because they are black, but because of the thoughts being put into each person’s mind. One of the most damaging forces tearing at young black people in America today is the popular culture's image of what an "authentic" black person is supposed to look like and how that person is supposed to act.   When asking the question “Are there more black males in jail or in college?” our own people quickly answered in jail. Not even second guessing themselves. When in actuality they are incorrect, the correct answer would have been there are more black males in college rather than in jail. This question was not just asked one time to only one person but was asked multiple times to people in different black communities. This same society expects African Americans’ to be uneducated, and having a lack of knowledge of their government or their surroundings in life. With the help of five intelligent and key black leaders’, activists and educators such as Dr. Steve Perry, Dr. Marc Lamont Hill, Dr. Boyce Watkins, Dr. Jawanza Kunjufu and Dr. Ivory Toldson, you will see how the commentary and insights of the......

Words: 924 - Pages: 4

No One

... Name Student ID 2. Name you prefer to be called 3. Programme (Circle One): BBM BBS Other_______________ Semester: _____ 4. Are you a transfer student from another Sunway campus? If yes, please state which campus and from what programme ______________________________________________________________________________________________________________________________ Are you a transfer student from a different college/university (circle one)? YES NO If yes, which college/university ______________________________________________ 5. Nationality: ____________________ Ethnicity: _________________________ Religion: __________________________ 6. Home town: 7. What Pre-University/Matriculation programme did you take before joining this programme at Sunway University? ______________________________________________________________________________________________________________________________ (for example: Form 6, UEC, FIA, A-Levels, AUSMAT, SAM, CIMP, IB, etc.) Were there any science/technology subjects in your Pre-U/Matric course (circle one)? YES NO 8. Did you take any science subjects or come from the Science Stream in primary and secondary/high school (circle one)? YES NO What was your experience taking science in school or pre-u/matric (circle one)? HIGHLY POSITIVE POSITIVE AVERAGE POOR/BAD ...

Words: 383 - Pages: 2

The One

...was challenging but attainable to achieve (Hellriegel, & Slocum page165). Because it is attainable and clear, members of the corporation are able to carry out the goals. Therefore the employees of Allstate’s are equipped with clear and defined goals, generating a more energetic and productive workforce. Second, the goal setting model used by Allstate involves, will, goal commitment, feedback and task complexity. The company established moderators to buffer the relationship between goals and performance. Through their employee development process, employees receive an assessment of their current job skills and are given a road map for developing the critical skills that are necessary for advancement. This meets the ability, which is one of the four moderators. To obtain the critical skills that are necessary for advancement, the company gives options that include, education, coaching and mentoring, and classroom training. The other moderators are met through feedback from employees and mandatory diversity training courses. Through the third step: Measurement, Allstate gives out a survery to its employees call the Diversity Index. Finally, Performance, Rewards, Satisfaction and Consequences are met through the company’s step four process: Accountability and Reward. To connect compensation to this goal setting process, 25 percent of each manager’s pay is based on the Diversity Index and the QLMS. Discuss the competitive advantage Allstate has from the development......

Words: 738 - Pages: 3

Banc One

...been discussed in the case the main issue for Banc One is the tremendous drop of its stock price in the market. The fair value for the stock price is to reflect the earning of Banc One’ earnings but this was not the case for Banc One and here was the issue. Given, the fact that the Banc One earnings were increasing from one year to year, it was expected for it’s the stock price to accordingly not to fall. It is also mentioned in the case that Banc One had very well defined, three-pronged strategy: 1. Concentrate on retail and middle-market commercial customers 2. Use technology to enhance customer service and to assist in the management of Banking facilities. 3. Grow up rapidly by acquiring profitable Banks. In the 1990s Banc One was considered to be one of the top ten acquires in the country. Usually, when one corporation wants to acquire another corporation, there will be comparison of price to earnings ratios (P/E) of the firms involved. If the target firm's P/E ratio is higher than the acquirer's P/E, then the transaction is dilutive because the acquire firm would have to pay more for the acquisition. As mentioned earlier the stock price of Banc One falling in the market, and this drop in the price will be an obstacle in there way whenever they want to acquire another firm. Since price to earnings ratio of Banc One would be lower than the targeted firm, the acquisition deal will be dilutive; hence, Banc One would have to pay more to acquire the......

Words: 559 - Pages: 3

One One One

...ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE ONE...

Words: 304 - Pages: 2

The One

...to private school, which would mean that they are not benefitting from the public service of public education. As mentioned before with the example of jewelry consumers, if the owner’s of vacation homes do send their children to public school, then the tax would be justified according to the benefits principle. To evaluate if a tax code is horizontally equitable, one must determine which differences are relevant for a family’s ability to pay and which differences are not. In the case of a sales tax on jewelry, if a family is able to pay for jewelry it is most likely able to pay for the sales tax on said jewelry. The same is true for a family with a vacation home. If a family can afford to have two homes, it can probably afford to pay the property taxes on the price of both of their homes. According to the horizontal equity theory, in both the case of a sales tax on jewelry and a property tax on vacation homes, the tax codes seem equitable. I think that both sales taxes on jewelry and property taxes on vacation homes would be considered as progressive taxes. This is because since high-income taxpayers are the ones buying the jewelry and owning vacation homes. Because low income tax payers do not incur any of the costs of buying jewelry or owning vacation homes, none of their income will be taxed. On the other hand, the upper class will pay a larger fraction of their income on taxes, due to the taxes they pay on jewelry and vacation homes....

Words: 592 - Pages: 3

The One

...table showing how much of a product firms will sell at different prices. PRICE (in kilos) | QUANTITY SUPPLIED (in kilos) | 10 | 33 | 12 | 41 | 14 | 51 | 16 | 63 | 18 | 78 | 20 | 90 | Supply Curve * A graph illustrating how much of a product a firm will sell at different prices. Law of Supply * Positive or direct relationship between the quantity supplied and the price. * “ all else equal , as price rises, the quantity supplied rises, as price fall the quantity supplied falls”. Determinants of Supply * Price of the good * Cost of production * Technology * Taxes * Number of sellers and suppliers * Weather Change of Quantity Supplied * The movement from one point to another on the supply schedule and on the supply curve Change in Supply * A shift in the supply curve from the original curve. PRICE | ORIGINAL QS (in kilos) | NEW QS (in kilos) | 10 | 33 | 39 | 12 | 41 | 47 | 14 | 51 | 57 | 16 | 63 | 69 | 18 | 78 | 84 | 20 | 90 | 96 | Market supply * The sum of all that is supplied each period by all producers of a single product....

Words: 262 - Pages: 2

The One Is One

...An essay has been defined in a variety of ways. One definition is a "prose composition with a focused subject of discussion" or a "long, systematic discourse".[1] It is difficult to define the genre into which essays fall. Aldous Huxley, a leading essayist, gives guidance on the subject.[2] He notes that "the essay is a literary device for saying almost everything about almost anything", and adds that "by tradition, almost by definition, the essay is a short piece". Furthermore, Huxley argues that "essays belong to a literary species whose extreme variability can be studied most effectively within a three-poled frame of reference". These three poles (or worlds in which the essay may exist) are: The personal and the autobiographical: The essayists that feel most comfortable in this pole "write fragments of reflective autobiography and look at the world through the keyhole of anecdote and description". The objective, the factual, and the concrete-particular: The essayists that write from this pole "do not speak directly of themselves, but turn their attention outward to some literary or scientific or political theme. Their art consists on setting forth, passing judgement upon, and drawing general conclusions from the relevant data". The abstract-universal: In this pole "we find those essayists who do their work in the world of high abstractions", who are never personal and who seldom mention the particular facts of experience. Huxley adds that "the most......

Words: 442 - Pages: 2

As One

...Mankind and their Power of Love, I bet if there is God....he would fall for it!!! "That small smile, Makes me go crazy. And that small love, I would trade my life for it. Oh Mankind, Why don't you realize your strength of Love." That Scant light showed me few glowing hearts with Scars, far away they live and they made path for the rest.They seemed to see the world in the eye's of others who are in need, as one!!So did I fall head over heels for these crazy hearts which beat for what they stand for and for their fellow brothers. And one of them is Malala Yousafzai. Everything is right in front of us, yet we fail to understand!! But there is this God, whom one have never seen and there they walk into a black hole in search of what is within.Is this what is called "Search that never ends"??!!Forgive me, If I was rude.. There they lay comfortably with their blanket of Religion,Race and so on, wrapped around them so tight.....that it has blinded their eyes!! "If you shoot, I die in a minute. If you love, I die every second seeking it" Where is life taking us??Why was I born??Why cant I change things??Why was I born as a girl??!! Cries a small heart... Miles away from her!! Never met her in this life of mine!! Yet her cry is heard!!! Are we ignorant of our intelligence, our capacity to empathize or are we pretending to be Ignorant ??!!I don't see the point in knowing, feeling and then not acting!!??!! Are we ignorant of our intelligence,......

Words: 380 - Pages: 2

The One

...sure that the number is within the limit of 40-50 • Arrange your references in alphabetical order • Cite them properly according to the MHRA (Modern Humanities Research Association) guidelines for referencing your work. These are laid out in Section 10 of the MHRA Style Guide. At http://www.library.soton.ac.uk/infoskills/referencing.shtml#MHRA you will find a link to the Style Guide. There you will also find links to documents containing MHRA-format examples from the Guide, and from the New College Humanities Programme Handbook. • Check and double-check for inaccuracies and inconsistencies in spelling, punctuation and spacing • Include as wide a range of types of information sources on your topic as you can find. The main ones are books, journal articles, electronic journal articles, conferences, theses, websites, and newspaper articles, reports and government publications (though the last two types are unlikely for the subject of this sample bibliography) • Choose references that are up to date, unless your topic has a historical slant, in which case older material will be appropriate • Select from good quality resources with academic validity THE BIBLIOGRAPHY The subject chosen is Post-structuralism. Search strategy: The topic has a lot of material. To reduce this and to ensure that references will be up to date, only items published between 1998 and 2003 in English have been used. A wide range of information sources has been......

Words: 1295 - Pages: 6

SK: Hráč EN: The Player CZ: Hráči Zobraziť seriál Počet epizód: 9 | La Femme Nikita | Black-ish S04E18 720p HDTV x264-worldmkv [eztv]