Bank One Corp. plans to sell $2 billion of senior notes on Thursday, giving momentum to an expected surge in bank capital raising in the third quarter.

On Tuesday, Wells Fargo & Co., in a much smaller deal, arranged a sale of $250 million of three-year senior notes with a fixed rate of 6.375%. The deal is being done through a subsidiary, Minneapolis-based Norwest Financial Inc. It was priced at 80 basis points above Treasuries.

Japan's Sanwa Bank Ltd. said it hopes to sell $1 billion in 10-year notes this summer.

Such bond sales are leading the way into what is expected to be a heavy third quarter of bank issuance of debt. The funds will be used to refinance maturing debt and to brace for potential year-2000 liquidity problems. The debt is expected to be issued as soon as possible in case the Federal Reserve raises interest rates further.

Bank One may be "trying to beat everybody to the punch," said Michael Leit, an analyst for Prudential Securities in New York. "Everybody knows earnings are going to be good." And good earnings could make it a few basis points cheaper for banks to raise medium-term funds.

"You are going to see financial companies just load up" on capital, said Winnie Cheng, an analyst for Bank of America Securities Inc. in Charlotte, N.C.

Even without market disruptions from potential year-2000 worries, she said, "people are concerned about the economy and where the Fed may move interest rates."

The time might also be ripe for issuance of debt because of an improvement in prices for Treasury bonds in the past few weeks. With market jitters the past two days over Latin American economies, Treasury yields are at their lowest levels in six weeks.

Because investors have been fleeing to safer U.S. bonds, their yields- moving inversely to their prices-have been falling, tugging corporate bonds along. That allows companies to strike opportunistically, hoping to snatch a better fixed rate on the day they are priced.

Now that Treasury bonds are rallying, the banks see that "this is a pretty good time to issue," said Scott O'Donnell, an analyst for J.P. Morgan Securities Inc. in New York.

Industrial companies also are taking advantage of market conditions. A week ago investors scooped up $8.6 billion in bonds of Ford Motor Co. and its subsidiary Ford Motor Credit Co. With the gargantuan Ford issuance out of the way, observers said, issuers can feel more confident they will have investors' attention.

The Bank One notes will be sold in three-year and seven-year tranches. The seven-year notes are being offered at around 105 basis points over the yield on comparable Treasuries. The spread on three-year notes will approach 80 basis points. The bonds, issued by the holding company, are rated Aa3 by Moody's Investors Service and A-plus by Standard & Poor's.

Compared with secondary market bond prices Tuesday, the issues would offer investors a premium. For example, comparable Bank One seven-year notes were trading yesterday at a 100-basis-point spread, according to an analyst.

Bank One's $2 billion is part of a $10 billion shelf registration with the Securities and Exchange Commission in February.

The Chicago-based company is part of a handful of large U.S. banks turning to the global markets to raise cash. The notes are being listed on exchanges in the United States and Europe.

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