Milwaukee-based Marshall & Ilsley Corp. plans to close, streamline, or renovate 59 offices and reduce its staff of 9,000 by an unspecified number.

The cost-cutting actions are apparently a reaction to those taken by its chief in-state rival, Firstar Corp.

M&I, Wisconsin's oldest bank company and its second-largest with $13 billion in assets, has so far reviewed 97 of its 250 branches.

"This is not a big, special program with a special name," said Ben Crabtree, an analyst with Dain Bosworth Inc. "What you see here is recognition they've got to get profitability of the bank up."

M&I spokesman Michael Hatfield explained the revamping as an attempt "to provide our products and services more efficiently to our customer base."

Mr. Hatfield said the planned branch closings and staff reductions follow an effort begun in September 1993 when M&I announced it would acquire $4.3 billion-asset Valley Bancorp. In recent months, M&I has reduced its back-office operations and centralized mortgage operations from 30 banks to one.

M&I's chief competitor, Milwaukee-based Firstar, announced in January it would cut 2,500 jobs, or 26% of its work force, and take out $110 million in expenses by the second quarter of next year, in an effort to become more efficient. Although M&I is distancing itself from its rival's plans, analysts believe M&I is concerned over them. Firstar hopes to reduce its expenses-to-revenue ratio to 55% from 58% by yearend.

Joan Goodman, an analyst with Donaldson, Lufkin & Jenrette Inc., said Firstar could have a big product-pricing advantage if M&I doesn't improve its current efficiency ratio of 65%. But Mr. Hatfield said that number is misleading, because the company's processing arm, M&I Data Services, skews the figure. The efficiency ratio for the bank operation alone is 58%, he said.

M&I plans to shutter six branches in Milwaukee and Madison, its two largest markets, and close the lobbies of five other offices in those cities. The company plans to downsize or relocate another nine branches throughout Wisconsin and renovate 39 more.

In a letter to employees, chairman and chief executive James Wigdale said M&I would try to find other positions in the organization for those whose jobs were being eliminated. "However, we recognize there will be some staff reductions, which we hope will be achieved through attrition and retirement," he wrote.

Mr. Hatfield said the company has an annual employee turnover rate of between 10% to 12%.

M&I said it designed its cost-cutting plan after surveying 1,200 customers, asking each about delivery of banking services.

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