With a series of relatively quiet disclosures, Banc One Corp. is revealing details of its plan to cut hundreds of millions of dollars in noninterest expenses over the next two years.

The program, which is winning praise on Wall Street at a time when Banc One is being criticized for its exposure to financial derivatives, focuses on the streamlining of computer and back-office operations.

The plan largely avoids massive staff reductions like those announced by other major banking companies, such as Fleet Financial Group and U.S. Bancorp.

Not going the high-profile press conference route, Banc One chairman John McCoy has been outlining the plan in meetings with security analysts.

In a detailed presentation at the Salomon Brothers global banking conference in New York late last month, Mr. McCoy said he expects to cut expenses by $150 million this year, primarily by moving all bank branches and data centers to the same type of computers and software, and by consolidating check, trust, and credit card processing operations.

Key to Profit Growth

Similar cost-cutting moves are likely to save another $200 million in 1995, he said.

Carole S. Berger, an analyst with Salomon Brothers, said the plan is the key to Banc One's profit growth in an era of rising interest rates and declining net interest margins.

She said in a report last week that the cost-cutting plan will "more than offset" any decline in Banc One's net interest margin.

She added in an interview that while other banks are also cutting costs, Banc One appears to be "more proactive" than most.

The magnitude of the cost reductions for 1994 had been previously disclosed by Banc One. But Ms. Berger said that she had not seen the elements of the cost-cutting plan before mr. McCoy's presentation.

She added that she had never before heard Mr. McCoy give such details about 1995.

Conversion of Common Systems

The biggest element of the cost-cutting plan - saving an estimated $30 million this year - is the conversion to what Banc One calls common systems.

The plan calls for all platform personnel to use branch software developed by, and now used in, the Ohio-based holding company's Arizona subsidiary. Tellers will use software from Software Dynamics Inc. of Chatsworth, Calif., under a contract Banc One signed with Systematics Information Services Inc.

Lenders will use loan origination software from Credit Management Solutions Inc., Columbia, Md., and the data centers in Columbus and Arizona will run a mix of deposit and loan accounting systems now deployed in Columbus.

Customer information will be consolidated into software called the Strategic Banking System, which Banc One and Norwest Corp. have developed with Electronic Data Systems Corp., and all of the computers are to be linked with a modern communications system using a leading edge technology called frame relay.

Robert L. Barrett, president of Banc One's technology unit, said the common systems project is scheduled to be largely completed by 1995. He said the effort is "probably as difficult and as large [a technology undertaking] as any bank has tried to pull off in this country."

Other savings are to come from the consolidation of credit card accounts onto the Triumph accounting software that Banc One has developed with Andersen Consulting of Chicago.

The bank also expects to save $55 million by consolidating its check processing operations throughout the country, along with its trust operations and its back office operations in Texas.

Some back office jobs will be lost in the process, bank officials said, but they say growth in other areas will offset the losses.

Spokesman John Russell said that Banc One's payroll will grow slightly this year, from the approximately 50,000 now employed. He said the lead bank in Columbus has postings for 425 job openings.

Mr. Russell said Banc One views expense reduction as "an ongoing project," and therefore has not wanted to call special attention to the projections for 1994 and 1995.

Are Reductions Enough?

One of Banc One's biggest critics, stock analyst George M. Salem of Prudential Securities Inc. in New York, said he thought the savings were important.

On April 29, Mr. Salem lowered his per-share earnings estimate for Banc One to $3.20 this year and $3.55 in 1995.

He reiterated the criticism he has voiced since December of Banc One's interest rate swap investments, which he believes are cutting into the bank's profits as interest rates increase.

But in a report last week, Mr. Salem wrote that Banc One was "unlikely" to have significant cost reductions before 1995.

Mr. Salem said Monday that he was unaware of the magnitude of Banc One's planned expense reductions. He added that the reductions "might be enough" to compensate for a decline in Banc One's net interest margin.

Banc One's stock closed Monday at $30.88, down substantially from its peak of $43.25 in April 1993 and down slightly from its close of $31.37 on Friday.

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