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Commercial banks

$56.6 Billion Merger Between BankAmerica and NationsBank Approved by US Justice Department

Strategic Insights

— 1 min read

The proposed merger between BankAmerica Corp. and NationsBank Corp. has taken a significant step forward, as the US Justice Department has approved the $56.6 billion deal. The merger, expected to be completed after September 23, will create the nation's largest bank, with BankAmerica's San Francisco headquarters and NationsBank's Charlotte, North Carolina base. However, the transaction still faces a regulatory hurdle, as the Federal Reserve is scheduled to consider it on Monday. In a separate development, Adaptec Inc. is set to lay off 100 employees, or 4% of its workforce, as the company struggles with declining sales. McDonald's Corp. has also restated its second-quarter earnings to reflect a $125 million charge over a longer period, following the Securities and Exchange Commission's guidance.

Key Takeaways:

  • The US Justice Department has approved the $56.6 billion merger between BankAmerica Corp. and NationsBank Corp., pending Federal Reserve approval.
  • The two banks agreed to sell 17 branches with $491.6 million in deposits in New Mexico, addressing concerns from regulators.
  • Adaptec Inc. will lay off 100 employees, or 4% of its workforce, due to a slump in sales.
  • The company's interim CEO, Larry Boucher, will take a second-quarter restructuring charge without providing details on the amount.
  • McDonald's Corp. restated its second-quarter net income to $357.2 million, or 50 cents a diluted share, after the Securities and Exchange Commission raised questions about taking a $125 million charge in one lump.

Statistics:

  • $56.6 billion: The value of the proposed merger between BankAmerica Corp. and NationsBank Corp.
  • 17: The number of branches that the two banks agreed to sell in New Mexico, with assets of $491.6 million.
  • 4%: The portion of Adaptec Inc.'s workforce that will be laid off.
  • 100: The number of employees that Adaptec Inc. will fire.
  • $491.6 million: The deposits held by the 17 branches in New Mexico, which the two banks agreed to sell.
  • $357.2 million: The restated second-quarter net income of McDonald's Corp.
  • 50 cents: The restated diluted earnings per share for McDonald's Corp.
  • $125 million: The charge that McDonald's Corp. took over a longer period, addressing the Securities and Exchange Commission's concerns.

Sources:

  • The Morning Call
  • wire report
  • BankAmerica Corp.
  • NationsBank Corp.

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