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Non-Tech : BANK ONE -- Ignore unavailable to you. Want to Upgrade?

To: James F. Hopkins who wrote (207)	11/22/1999 8:53:00 PM
From: David C. Burns	Read Replies (2) \| Respond to of 466

Losses Disappoint Bank One Chairman, GRAND RAPIDS, Mich. (AP) - The hemorrhaging of customers from Bank One Corp.'s credit card business appears to have been staunched, the company's chairman said Monday. But he stopped short of saying it would be enough to cure the financial ills at the nation's fourth-largest bank. John McCoy's comments came a week after he canceled a scheduled call with analysts to discuss problems at Bank One's credit card business expected to cost half a billion dollars this year. But at a meeting before the Economics Club of Grand Rapids, he stressed that the bank still expects to earn significant profits. ``We'll miss this year's (earnings) target by 8 to 10 percent, but we'll still be out by 10 to 12 percent from a year ago,' he said. ``We made $4 billion this year.' The stock was up 37 1/2 cents Monday at $36.81 1/4 at 5:15 p.m. on the New York Stock Exchange. Earlier this month, Bank One lowered its earnings outlook for the year to between $3.45 and $3.55 per share. Analysts had been expecting $3.59 for the year and 92 cents for 1999. In August, the bank told analysts to expect a $500 million shortfall from First USA, its credit card and consumer lending business, because of ``softness' in earnings. The credit card division accounts for more than 30 percent of Bank One's business. McCoy told reporters Monday that the Nov. 15 call with analysts was delayed to allow new management at First USA to get a better handle on the problems. William Boardman took over the division tin October after Richard Vague stepped down on flat third-quarter earnings. He plans to talk with analysts before early January 2000. McCoy said he believes the number of credit card customers leaving First USA has ``peaked,' because of strategic moves, including giving customers a one-day grace period for late payments. But he declined to answer questions about other problems in the business or say when there might be a turnaround. He also did not answer questions about rumors that Bank One might be a possible merger target, or if wingspanbank.com, Bank One's online venture has been profitable. Diana Yates, an analyst with A.G. Edwards & Sons in St. Louis, said it is unusual for a company to cancel a meeting with analysts and said the company needs to explain the losses and the recent departure of several top executives. ``We believe the best option for Bank One is to try to fix the credit card issues and get the bad news out on the table,' she said. ``How do they go from A to Z on credit cards so quickly, and what type of controls ... and internal reporting was there?' Bank One is one of the nation's leading credit card issuers and has assets of more than $264 billion. In 1998 it acquired First Chicago NBD in a $19 billion merger.