Bank One Corp. is focusing on cost-cutting measures for the duration of 2001 in an attempt to meet its earnings target, industry observers said.

The Chicago banking company, which reported a $512 million fourth-quarter loss, has had a slower revenue stream during James Dimon's first year as chief executive. But Mr. Dimon, who has said the organization is nearing the end of what he called "boot camp," still needs to meet expectations after a grace period that included the fourth-quarter loss and a $1.26 billion second-quarter loss last year, observers said. "There has been a lot of work on getting the cost structure down," said David Berry, an analyst at Keefe, Bruyette & Woods Inc. In a conference call with analysts in January, Mr. Dimon said the company would reduce expenses to just below $10 billion for the year.

He said some of the savings will come from more effective spending on marketing and that the company also plans to focus more on quality initiatives.

In January, Mr. Dimon guided Wall Street to a $2.70 earnings-per-share estimate for the year. Mr. Berry lowered his estimate to $2.55 because of the operating performance of First USA, the beleaguered credit card unit at Bank One.

"It is going to take some time to get it growing," Mr. Berry said.

But Bank One has some initiatives under way.

Philip Heasley, who was selected to head the credit card unit, is starting to put his imprint on First USA. His plans include cross-selling more First USA cards, recruiting more co-branding partners, and creating a corporate purchasing card, industry observers said.

The initiatives are similar to Mr. Heasley's efforts at U.S. Bancorp in Minneapolis, where he created a corporate purchasing card.

"The challenge for the organization relates to growth," Mr. Berry said. "The retail business is generally speaking not a rapidly growing business."

Gerard Cassidy, of Tucker Anthony Cleary Gull, commended Bank One's plan to launch a corporate card, noting that First USA has a captive audience in Bank One's existing customer base. " The cost is less than a mass mailing," he said.

Bank One's stock rose 2.54%, to $36.71 in trading Wednesday.

Separately, Lori Appelbaum, an analyst at Goldman Sachs Group Inc., reestablished her coverage of FleetBoston Financial Group with an "outperform" recommendation Wednesday.

Ms. Appelbaum said FleetBoston is instituting incentive compensation to increase sales of its asset management, credit card, and traditional banking products.

Still, capital markets will probably be a drag on near-term earnings, Ms. Appelbaum said. Private equity is poised for moderate losses in the first quarter, she said. At Robertson Stephens & Co., the company's San Francisco investment bank, arranging initial public stock offerings has ground to a halt, and trading volume through Fleet's online brokerage, Quick & Reilly, is also expected to be weak.

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