The morning of Monday, Aug. 28, 1995, was sunny and warm, and most New Yorkers were following the O.J. Simpson murder trial while looking ahead to a holiday weekend. As usual, Amy S. Hirson took the train from Baldwin, Long Island, to Manhattan and slipped into her office at Chemical Banking Corp.

On her desk was a memo stating that the company had agreed to merge with Chase Manhattan Corp.

Never had a merger of such magnitude occurred in U.S. banking. The statistics were staggering: a $10 billion transaction creating a $300 billion banking company with a combined 1,000 branches and 75,000 employees-who were told 12,000 of them would have no place in the combined organization.

What followed for many was a test of professional and emotional fortitude, and this is the story of how a few of them fared.

The announcement came as a surprise to Ms. Hirson, but also a relief. For weeks, people at both banks had been buzzing about who from the executive suite had been breakfasting with whom, which limousines had been seen pulling up to headquarters, whether and when a merger would take place.

"It was surprising because it was definitive who the merger partner was, but it didn't seem that out of the ordinary," said Ms. Hirson, who in 10 years at Chemical had survived a previous megamerger, with Manufacturers Hanover Corp., and who is now vice president of information technology and operations at the "new Chase."

On that August morning, she quickly called her husband, who works at the Federal Reserve Bank of New York. By then the news was already out.

At Ms. Hirson's office-as at those throughout both organizations-the immediate reaction was the same: What is this going to mean for me? For my job? For my group? Does the other bank have a department that duplicates ours?


Interviews with more than a dozen Chase executives-some sanctioned by the bank but most not-paint a portrait of a new bank with a distinct culture that is perhaps two parts Chemical, one part "old Chase."

Everyone agreed the business decisions behind the combination were sound: It created a stronger organization that, as the largest banking company in the country, was a plum for everyone involved. The Chemical name was seen as no great loss.

People who had lived through the Chemical-Manufacturers Hanover merger also agreed that this one was done better, faster, and with less acrimony. Lines of reporting were established early, and systems decisions were quick and firm.

"Mergers are great because they allow you to examine the best things about two organizations," said Sarah E. Jones, a Chase senior vice president in private banking who had been with Chemical for 20 years.

"People tend to assume that you get inwardly focused and you're not thinking about the competition," she said. "But in fact you're more focused than ever externally, because with everything you do, you're asking, 'Is this a better way, or is that?' You're rebuilding your organization, which is a very healthy and great process."

To quell water-cooler grumbling among her staff of 80, Ms. Jones held frequent meetings. She tried to keep them "pumped up" and focused on the benefits the merger would bring to her group, which markets the Vista family of mutual funds.

Personally, Ms. Jones said, the merger has brought greater responsibility and more opportunities to travel. She has been to an off- site meeting in Hong Kong and several conferences in Europe.

Though she keeps a picture hanging in her office of a Chemical Bank branch reflected in the glass of a Chock Full O'Nuts store, Ms. Jones is not wistful.

"I used to say, 'At Chemical we do such-and-such,' and now I say, 'At the bank,"' she said, laughing. "That way, if we change it again ... ."


The day after the merger announcement, all employees were invited to auditoriums around New York to watch a video presentation by Walter Shipley and Thomas Labrecque-chairman and president of the new Chase, respectively. Ms. Hirson was assigned to the Metrotech building in Brooklyn.

"I thought it was effective," she recalled. "It was a fast move to say, 'We want you to know about this, and we're going to do the best we can to broadcast this worldwide.'"

Ms. Hirson heads a group of 16 people who provide technology support for middle-market customers. By late September she was giving demonstrations of her client-server system to the top brass, who quickly decided it was a "keeper."

What followed was a whirl of meetings-task force gatherings, interdepartment get-togethers, focus groups, strategy and planning sessions. For the first time, Ms. Hirson was traveling all over the city to meet colleagues, all frantically networking to find their way through the new banking behemoth.

Workdays were stretched on both ends. Ms. Hirson began coming into the office at 7 a.m. for some quiet time before the inevitable onslaught of phone messages, meetings, and memos. Her volume of electronic mail jumped by a third, to around 100 a day. Identifying the right person to contact about a particular issue or problem turned into a scavenger hunt.

"One of the big challenges is just finding your way through a big organization like this," Ms. Hirson said. "Everybody talks about this-there are just so many people, and as areas are reorganized or reshuffled, it becomes a tremendous challenge.

"Having people who work with you who will say, 'Oh, I know people at Metrotech, I know who to call, I'll make that happen,' has been really helpful."


Chase bankers uniformly say the corporate culture seems to be more social than in the past, in keeping with the company's emphasis on becoming the "relationship" bank.

The old Chemical culture was described as almost nerdy, with little fraternization after hours.

"We have made a lot of time for each other in terms of getting to know one another," Ms. Jones observed. "I have spent a lot of time out with various peers in private banking at dinners and so on, and that wasn't something we did much at Chemical."

Among the nostalgic from both camps the common complaint is that something ineffable has been lost. Many people who have left-and most did so of their own accord-said feelings of camaraderie were replaced by a sense of vastness.

Before the merger, the old Chase had hired the noted (and vilified) reengineering consultant, Chandrika Tandon, who had been drawing up downsizing plans. Some executives started job-shopping, and many have continued to do so, spurred in part by the tripling of Chase's stock price and a new pension plan that makes it easier to change jobs and keep certain benefits.

"The merger was not really a merger-it was a legal takeover by Chemical, and most of my former colleagues and friends see it as a Chemical-dominated merger that they have had to assimilate to," said Thomas A. Hayne, a senior vice president who retired just before the merger.

Mr. Hayne worked at Chase for 32 years and has fond memories. He still drops in regularly at 270 Park Ave., the new headquarters. He finds the people he doesn't know to be somewhat more "combat-hardened" than former Chase people.

"This is the second time for Chemical, so they are a little more businesslike, dog-eat-dog," Mr. Hayne said. "The (Chase) people who ended up in good shape are happy. The people who didn't end up in good shape are not as happy-they're cynical. In hindsight, it's exactly what you would expect."


Some high-ranking executives were offered golden parachutes at the beginning of the process; others gradually left voluntarily. Among the prominent defectors from the old Chase were vice chairman E. Michel Kruse, who became chairman of BHF-Bank of Germany; Robert D. Hunter, chief financial officer, who became president of Standard & Poor's Financial Information Services Group; Craig D. Goldman, who was in charge of distributed and advanced technologies; and Deborah L. Talbot, head of global payment and treasury services.

On the Chemical side, senior vice chairman Edward D. Miller and his longtime associate Charles R. Walsh, the credit card chief, announced their retirements.

One former high-ranking Chase officer, who was not invited to join the new management team and spoke on condition of anonymity, said some may have left because "the bank is big and bureaucratic, and I don't believe it's as fact-based as it could be in making decisions.

"I think a lot of people feel a longing for the culture and values they had previously, and they find a lot of politics."

This departed officer also perceived some lingering snobbery over the fact that the Chase name carried more cachet, yet the Chemical people were in charge.

"Let's not kid ourselves-when you joined Chase in the '60s or '70s it was much more prestigious than the others," he said. "Much better people went there. But Chase got in the end what it deserved because it did not perform in the marketplace."

Another who did not leave voluntarily was John Hale, who said he was fired last year-a "very painful" outcome-after 28 years at Chase. He had been a vice president in the broker-dealer division.

"I never would have left. I was two to three years away from early retirement," said Mr. Hale, who said he knew of "hundreds and hundreds" of others who were let go because of the merger.

Mr. Hale is now working in the municipal finance department of his hometown, Jersey City. He is crossing his fingers that Chase comes through on a promise to continue giving medical benefits to people over a certain age who lost their jobs because of the merger. Without that, he said, he faces "a pretty bleak retirement."

Mr. Hale is in touch with many former colleagues still at the bank. "I understand that it's 'them' and 'us,'" he said. "The Chemical people are all sticking together and not integrating at all with the Chase people. Since the Chemical people have the upper hand, they're lording over the others.

"Before, we really were a family and worked all together," he added. "Now it's a business and people are not happy."


On March 31, 1996-the day the merger was consummated-Mr. Shipley and Mr. Labrecque stood at the top of the escalators in Chase's main lobby, greeting everyone with a handshake. Advertisements for the new bank appeared in newspapers, and the building was decked out in new signs.

"When everybody came in it was like, 'Welcome to the new Chase,'" Ms. Jones said.

A few weeks later, Mr. Shipley, executive vice president Frank Lourenso (formerly of Chemical), and other honchos led a prospecting "blitz," visiting thousands of middle-market customers on a single day.

Marie J. Toulantis, senior vice president in middle-market lending, went out with Mr. Lourenso to call, among others, on a father-son antiques firm. As an "old" Chase person who used to fight uphill to coax market share from Chemical, it felt great to go out as a team with former competitors, Ms. Toulantis said.

Before the merger, middle-market lending in New York City "was really a slugfest," said Ms. Toulantis, who heads a group of 30. "At the Old Chase, we were much more leanly staffed, and we didn't have the manpower to compete.

"When you would go visit a client or prospect, they had often just met with Chemical," she said. "It was difficult to dislodge a long-term relationship with Chemical."

The merger brought Ms. Toulantis a promotion. Her fears that other institutions would cherry-pick her clients were not realized. A few of her staffers left for other institutions, she said, but clients have stuck with the new bank.

"We're still lean in terms of the group, but we do have more support staff, more marketing resources," Ms. Toulantis said. "At the old Chase, if we decided to do a mailing, we had to do it ourselves. Now there's a group outside that will handle it."


Like Ms. Hirson, Ms. Jones, and others who stayed on, branch manager Charlee M. Miller has been struck by how her hours got longer and her work load heavier.

Instead of commuting two hours from her home in suburban Long Island- where she performs in community theater and takes piano lessons-Ms. Miller has begun renting a Manhattan apartment so she can stay close during the week to her branch in Greenwich Village.

The time constraints led her to stop volunteering at a Long Island center for pregnant teenagers. Instead, she takes correspondence courses for career advancement, hoping to become a certified financial planner.

Ms. Miller runs two branches that are being consolidated into one; correspondingly, her revenue targets doubled. The staff of 22 is down from 30. Ms. Miller has a front-row view of public reaction to the merger.

"People pretty much have accepted the fact that banks are merging and that branches are closing and opening," said Ms. Miller, whose desk looks out on the arch at the entrance to Washington Square Park.

There have also been a lot of meetings: first between her staff and that of the former Chemical office, and now frequent "hub" meetings for branch managers.

Paperwork has been a big headache, along with training workers on new computer systems.

"The most frustrating thing was when we went through the merger itself: forms changing, processes changing, handling all these daily tasks in addition to the regular work," Ms. Miller said. "The positive thing was our customer base became so much larger. The customers we had been prospecting were all of a sudden our customers."

Branch employees have left through attrition, and there were no layoffs. "There are some people who adapt to change well, and others who don't," Ms. Miller philosophized.

Amy Hirson, from the middle-market technology group, also observed that open-mindedness and flexibility were hallmarks of people who had remained with the organization. Malcontents, she said, were usually easy to spot.

"Once in a while you can be in a meeting and notice there are people who are very defensive and very aggressive in their statements about what their area does and what their role is, what their people can and cannot do," Ms. Hirson said.

"When you look back over months and years, you realize that the people who do best in these kinds of processes really are those who are trying to do a good job and cooperate with others."

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