Marriage of Opposites

Until last week, the National City Bank of New York and Manhattan's First National Bank seemed to have little in common. National City, under energetic Chairman Howard C. Shepherd, 60, went out for the little man's business, built up 71 domestic branch offices. With resources of $6.3 billion, it became the biggest bank in New York and second largest in the U.S.* But First National, the epitome of conservatism, had no branches. Known as the "banker's bank," it specialized in huge corporate accounts, began only in recent years to accept accounts of less than $200,000.

But the opposites attracted each other, decided that by joining forces they could cover the entire banking field. Last week, National City's Shepherd and First National's President Alexander Nagle published the banns. Though it was described as a merger (the fourth get-together of big New York banks in less than five months), the deal amounted to an outright sale. Under an agreement still to be approved by stockholders, National City will pay $165 million for the 300,000 shares of First National on the market (price per share: $550). The new bank will be known as First National City Bank of New York, with Shepherd staying on as chairman and Nagle becoming chairman of the executive committee. Its total resources will be more than $7 billion. National City already has the money to swing the deal: last October it raised $132 million with the biggest stock financing ever undertaken by a bank.

* After California's Bank of America ($9 billion). Next month, when their merger is slated to become final, Chase National Bank and the Bank of the Manhattan Co. will become second ($7.6 billion).

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