US finance giant JP Morgan Chase is to take over Bank One Corporation in a $58 billion deal to create the second largest bank in the US.
The merged company will be known as JP Morgan Chase & Co and will have a combined market capitalisation of around $130 billion.
The merger is expected to allow both entities to save $2.2 billion in operating costs over three years, with the banks saying that as many as 10,000 jobs could be cut, about 7% of the total work force.
With assets of $793 billion and operations in more than 50 countries, New York-based JP Morgan is currently the second largest US bank in terms of assets after Citigroup. Bank One, based in Chicago, is the sixth largest US bank holding company, with assets of $290 billion.
The takeover is the biggest financial services deal since the $70 billion merger between Citicorp and Travelers Group in 1998. The merger still must be approved by shareholders of both institutions as well as US federal and state and foreign regulatory authorities.
The deal has sparked expectations of further banking sector consolidation in the US, from which AIB could benefit if its 22.5% stake in the M&T group attracts attention.
