To split or not to split? That is the question for bankers right now.

As stock prices continue to skyrocket, many banks have passed the $100 mark or are close to it, and a split could be a good way to keep shares affordable to the average investor.

Citicorp, J.P. Morgan & Co., and Chase Manhattan Corp., are a few of the names bandied about by investors and analysts betting on the next likely candidate.

Though there are pros and cons, a report from Sanford C. Bernstein-which analyzed the practice from the 1960s through the 1990s-supports the theory that a stock split is a good move.

"We're pro splitting," said Michael Sommer, senior analyst and author of the report. "Our study goes back to the 1960s, and the results show splits help performance." He said the data were consistent for all types of economic environments. But with average stock prices in 1997 increasing to $46.70, from the historical norm of $40.50, "there's a pent-up demand for splitting."

Even momentum stocks that have risen rapidly can benefit from a stock split, said Mr. Sommer. His research indicated that growth stocks that split did incrementally better than those that did not.

"It could be interpreted as a vote of confidence on management's part that the stock will not go lower," said Mr. Sommer.

Bernie Schaeffer, president, Investment Research Institute, an advisory firm in Cincinnati, said splitting causes a "halo effect on prices."

He noted the "psychological impact" on investors, who convince themselves the stock "isn't really as expensive anymore," though the number of shares outstanding has increased. "It takes a little edge off," he said.

"Splits make the shares more affordable to smaller investors, broadening distribution," said James Deaver, a spokesman for Mellon Bank Corp., Pittsburgh. The bank announced a 2-for-1 stock split on April 15.

"We can't attribute performance to a single factor, but if we look at the shares on April 14 versus Aug. 6, they're up 38%." The Keefe, Bruyette & Woods bank index is up 29% during the same period, said Mr. Deaver. "The split certainly hasn't hurt us."

Mr. Schaeffer said options traders can profit from the action. "There are Web sites devoted to upcoming stock splits," he said. Retail investors, "looking for a short-term pop," can play the options and make money, as the stock often moves up around the split.

For example: Mellon Bank Corp. effected its split on June 6, when its shares went from $72.75 to $36.375. Its share price jumped $2 on the day of the announcement in April, $1 again on June 3, and another 50 cents the following days leading up to the split.

BankAmerica Corp.'s stock split on June 18, when share prices were halved, from $134.75 to $67.37. The following day the shares gained $1.125.

Even so, there is a downside.

"Our position is that a stock split is not a forgone positive," said Jack Morris, a Citicorp spokesman. Citicorp's shares closed at $134 Friday, down $2.50. "The literature is quite mixed on the subject of value," he said. "It adds expenses for the company issuing additional stock and the individual who buys and sells the shares."

Brokers' commissions rise on the number of shares bought and "a lot of people forget that," said Mr. Morris. Though a stock split causes "excitement in the market, and leads to a short term bounce," he said, "its not proved that it has long term value to stockholders."

Ken Feinberg, co-portfolio manager, Davis Financial Fund, can see both sides. "Bank CEOs have historically looked at the share price as being a badge of honor. If they're splitting from $60 to $30, it's not because they think it's going down to $20."

But he added, "We also like very high stock prices like Wells Fargo (& Co., at $261.625.) When the stock goes down $7 in a day, a lot of people notice it, and it fuels buying, but in reality the percentage change is like going from $26 to $24."

He said the best strategy might be an annual 5% stock dividend, which he called "a stealth split." The stock will go from say $50 to $47.50, "but it seems to edge right back up."

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