• 1248阅读
  • 0回复

284

级别: 管理员
J P Morgan & Bank One
Interview: Boston Advisors---Woolston, Tim---Fund Manager
>> welcome back. the highest ranking officer involved in the enron collapse is heading for jail. former chief financial officer andrew fastow pleaded guilty to conspiring to commit wire fraud and securities fraud. the 42-year-old father of two negotiated a prison term of 10 years and the judge reserved the right to increase the term. fastow must forfeit $23.8 million of assets, the majority of which were frozen by prosecutors. fastow’s wife, lea, will plead guilty later this afternoon to filing a false tax return. and the nation’s biggest bank reportedly buying the sixth largest bank. a combined j.p. morganchase and bank one would put it second in its class. this is a big deal. how big is it?

>> it’s a huge transaction, the biggest transaction to be announced this year. and j.p. morgan had telegraphed they wanted to get a branch network together and they’re getting a big one in bank one’s case. bank one has about $325 billion in managed assets, a huge credit card business and so it’s going to diversify j.p. morgan’s earnings and at the same time jamie dimon gets to run the company and he’s always talked about building a major brokerage capability and he gets it in one fell swoop here.

>> would you characterize this as jamie dimon’s deal?

>> my understanding is that he’ll take the reins and that would have been my expectations before i heard the details of the transaction. i think the shareholders of the combined company would expect jamie to run it. i think they probably have more confidence in his ability to take the company to the next level.

>> you cover bank one. you also own bank one individually. one big issue for j.p. morgan that analysts have seen has been earnings volatility here. will the combination of the branch network of bank one and j.p. morgan’s traditional assets help that at all, do you think, for the combined operations?

>> it certainly might increase bank one’s from a bank one shareholder, increases their earnings profits in terms of volatility a little more but from j.p. morgan’s shareholders standpoint, you’ll have capital markets a smaller percentage of the total and credit card earnings will go up. on a combined basis, card profits only account for 20%. you’ll have a more diversified bank at the end of the day. >> you said you think this will be the biggest deal of the year. it’s early in the year. could others pull the trigger on similar deals to compete in this situation?

>> i’m skeptical about large deals. i’m not sure you necessarily get great economies of scale in large transactions because they’re very complicated and it takes longer to get them done. but i think the transaction, i was able to pencil some numbers together and at the price it appears that they paid with 15% to 20% cost savings, the transaction will be close to break-even. i think the challenge for j.p. morgan shareholders here is they had a lot of upside to the earnings from a recovery in capital markets and recovery in their venture capital business and they’re sacrificing some of that for some stability long term.

>> let’s talk about some of the earnings coming up, bank of america is also due out to report earnings and it’s been active in m&a, as well, in the past several years. what’s your expectations for what’s ahead?

>> in the fourth quarter, i expect them to have a good quarter. we’re not going to see much commercial loan growth but that won’t hold them back. i think they’ll have a good quarter in principal investing, their venture capital business. i think spread income will do fine. on balance, mortgage earnings will be down from the record numbers in the third quarter but i think they’ll weather the storm and i expect earnings on a co-operating basis to be up from the third quarter. looking to 2004 and 2005, i expect despite the fact that they may have overpaid for getting into new england, i think the deal will end up working out and will achieve good results in 2004 and 2005.

>> speaking of getting into new england, we should get into fleetboston financial, as well.

>> in terms of the fleet deal, from my perspective, bank of america probably slowed their long-term growth rate down from maybe a high single-digit to around 8%,,,say from a 9% to an 8% level long term because new england is a slower growth rate but if you look at the stock price and valuation, we like the stock here. it is the cheapest name in the large cap group with a dividend advantage of maybe 250 basis points over the comparable s&p company and one00 basis points-plus, advantage to the average bank in our universe.

>> denis laplante, thank you very much, head of banking research with keefe bruyette & woods, appreciate your quick analysis of this news today.

>> thank you.

>> still to come, intel just reported results and now we’re waiting on samsung’s earnings, among others. analysts a the japanese chipmaker will probably say fourth-quarter profit rose to a record.we’ll have a preview and go to tokyo after the break.
附件: 4-1-14-2.rar (248 K) 下载次数:0
描述
快速回复

您目前还是游客,请 登录注册