Banc One Corp.'s $30 billion merger with First Chicago NBD Corp. would unite one's retail banking prowess and the other's corporate expertise under a single roof.

The resulting company, with $230 billion of assets and 56 million customers worldwide, would vault ahead of its midwestern competitors to become the region's leading bank.

The beefed-up Banc One would be the top consumer bank in eight states and the No. 2 credit card issuer nationally. And bolstered by First Chicago's commanding position in commercial lending, expertise in the capital markets, and overseas reach, it would be virtually unmatched in the region.

"This really sets up a dominant central states franchise," said Joseph Stieven, an analyst with Stifel Nicolaus & Co.

"Our goal has not changed," said John B. McCoy, chairman of Banc One. "It is to be a national provider of financial services." With this deal, he said, "We will be a premier provider in the Midwest and Southwest."

"This merger leverages the many strengths of both companies to create a powerful national banking franchise," said Mr. McCoy, who is slated to become president and chief executive officer of the combined company. "With greater economies of scale and skill, we will be an even stronger player in the financial services industry."

Mr. McCoy stressed the importance of scale, saying his goal is to be the "low-cost provider in each of our businesses."

The retail bank operations and finance company would serve 10 million households. The bank would serve 425,000 small business customers and it would have 112,000 private banking customers.

Indeed, Verne G. Istock, chairman of First Chicago and chairman- designate of the combined company, made clear that the company has national ambitions. Both men asserted that more acquisitions would be in the works once this deal is consummated and integrated.

"This is the best strategic deal for Banc One," said Joseph Duwan, an analyst with Keefe, Bruyette & Woods Inc. "It really fills out their Midwest franchise."

Mr. Duwan predicted a wave of mergers in the Midwest and beyond as a result. Most notably, U.S. Bancorp, which has cited as a logical acquirer of Wells Fargo & Co., may feel compelled to make a move. If anything, it signals "mergers of equals are back," said Mr. Duwan.

The deal makes sense on a number of fronts, said observers, from retail banking to the merged credit card operations, but Banc One, not historically viewed as a top business lender, will be gaining expertise from First Chicago's commercial bankers.

It would be the No. 1 bank ranked by relationships with midsize businesses with annual sales of $150 million to $500 million in the nation and will be the No. 1 banker to large corporations in the Midwest.

David J. Vitale, vice chairman at First Chicago, will head the commercial and capital markets businesses, while Richard J. Lehmann, Banc One's president and chief operating officer, will be in charge of retail banking, credit cards and consumer finance.

Other bankers acknowledged the significance of what would be their biggest competitor in the Midwest, particularly as a new commercial banking threat.

"These people are good bankers," said Eugene A. Miller, chairman and chief executive of Comerica Inc., Detroit. His company competes against First Chicago in Michigan for retail and commercial customers and against Banc One in Ohio and Texas for business customers.

Although he professed no fear of the competition, Mr. Miller acknowledged concern. "We always have to look over our shoulder for the big operators."

"I still think there's a lot of business for everyone," said Stephen J. Schrantz, executive vice president in charge of commercial banking at Fifth Third Bancorp in Cincinnati. "Is this a new competitive force to be reckoned with? Yes."

Michael Mayo, an analyst with Credit Suisse First Boston, said he believes the biggest impact will be Banc One's influence on the retail and credit card sides. However, merging with First Chicago "gives them some firepower at their disposal."

"Banc One's strength has clearly been on the retail side," Mr. Mayo said. "Banc One doesn't have the long-standing expertise in commercial banking," which is why they tapped Mr. Vitale to head that area of the company. Mr. Vitale is the No. 3 executive at First Chicago behind Mr. Istock and vice chairman Thomas H. Jeffs 2d, who will retire.

"David Vitale is a world-class capital markets player," said Peter Crist, president of executive recruiting firm Crist Partners Ltd. in Chicago. "If you're going to put the two platforms together, you have to keep David Vitale."

As far as other executives, it was unclear who would be let go. A chart of the 16 top executives showed eight from each company. Banc One's retail business would retain Kenneth Stevens head of retail banking, Richard Vague, the First USA executive would continue as head of credit cards and Donald Winkler would continue as head of consumer finance. Those executives would report to Mr. Lehmann, currently the No. 2 executive at Banc One.

Mr. Vitale would oversee corporate banking products, international banking and middle market. First Chicago executives Thomas McDowell and Susan Moody would head corporate products and international banking respectively. Banc One chairman of commercial banking Ronald G. Steinhart would head middle-market lending.

Though the deal is structured as a merger of equals, observers believe the Banc One culture will survive. "We see Banc One being in charge," said Mr. Mayo, noting Mr. McCoy's position as president and chief executive and the strong retail focus of Banc One, which was emphasized repeatedly by the companies Monday.

The deal would add to earnings by 1999 mostly through $930 million in expense savings. A large part of that will come from operations. The most overlap of branches would be in Indiana, particularly Indianapolis where Banc One holds the No. 1 deposit share and First Chicago holds No. 2 market position. Officials said they expected much cost savings from that market.

Mr. Istock said, "We cannot move fast enough in putting this organization together." That was an interesting statement from an executive whose company had not decided on a common name in the more than two years since First Chicago Corp. and NBD Bancorp merged. The new company will use the Banc One brand name for its retail banks.

First Chicago released its first-quarter earnings on Monday. The company reported net income of $383 million, down from $380 million from the year- ago quarter. It exceeded analysts' earnings per share estimates by a penny. Earnings were affected by a 3% decline in net interest income.

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