NationsBank completes Barnett Banks deal $15 billion purchase makes Carolina giant the biggest in Florida

Banking

January 10, 1998|By BLOOMBERG NEWS

CHARLOTTE, N.C. -- NationsBank Corp. yesterday closed its $15 billion purchase of Barnett Banks Inc., the most expensive purchase of a U.S. bank.

Buying Barnett, with $44 billion in assets and about 20 percent of the deposits in Florida, will make NationsBank the biggest in the state. NationsBank has banking operations in 16 states and Washington, D.C., and $240 billion of assets.

"Today NationsBank becomes Florida's largest banking franchise," Hugh McColl Jr., chief executive of NationsBank, said in a statement.

Banks have been buying each other at a rapid pace to cut costs and increase profitability. Banks have been particularly interested in purchases in Florida, the fourth largest state and the fastest growing in the nation.

Part of those cost cuts involve reducing the number of employees. NationsBank expects to cut more than 6,000 jobs in Florida as part of the merger.

A NationsBank executive said earlier this month that a hiring freeze, coupled with turnover and retirement, should account for the bulk of the cuts rather than mass firings.

To clear antitrust hurdles, NationsBank agreed last month to sell 60 branches in Florida for $523 million to Huntington Bancshares Inc. It also agreed to sell eight branches to Republic Bancshares Inc. for $37.8 million.

Including Barnett, NationsBank is expected to report year- end 1997 assets of about $310 billion, $25 billion in shareholder equity and the largest market capitalization of any U.S. bank.

NationsBank has grown through acquisitions for more than a decade and stepped up the pace in the 1990s as banks, seeking more profits by cutting costs and boosting market share, merged in record numbers.

NationsBank bought Boatmen's Bancshares Inc. in January for $9.76 billion and Montgomery Securities for $1.2 billion in October.

Pub Date: 1/10/98

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