National City Corp. will extract more savings this year than it had expected from the merger with First of America Bank Corp., but revenue gains will be smaller than predicted.

So says David A. Daberko, National City's chief executive officer. The company bought First of America in March.

Mr. Daberko, who is also chairman, said savings should increase after Oct. 31, when the First of America operations convert to National City's computer system.

The revenue shortfall will be made up next year, he said.

"We stand for consistency and living up to promises," Mr. Daberko said in an interview this week. "We did exactly what we wanted to."

National City, which has $81 billion of assets, is based in Cleveland. First of America, with $22 billion, was based in Kalamazoo, Mich.

Securities analysts said merger-related expense cuts will fuel much of National City's earnings growth in 1999.

The company now expects to cut $105 million of First of America's costs in 1998; the goal used to be $77 million. But next year it could cut $251 million, 8% better than projected.

Some of the savings are coming from closing or selling branches. First of America had 550. Fifty-nine have been closed and 14 sold, a company spokesman said, and at least 14 more are likely to be sold.

Merger effects alone are now expected to boost 1998 revenue $23 billion above the two companies' 1997 total. That is 16% less of a contribution than predicted earlier. But the boost next year is expected to be $92 million, 27% more than had been predicted.

Mr. Daberko said customer attrition resulting from the merger has been low. "We're committed to making this work well with minimal customer disruption," he added.

National City is considered a skillful acquirer, but it is not likely to do any big deals soon. It is busy with the computer-system integration and assimilating $3.3 billion-asset Fort Wayne National in Indiana, which like First of America was purchased in March.

Fred Cummings, an analyst with McDonald & Company Securities, Cleveland, said National City will be preoccupied with those merger concerns for a while. Because of its falling share price, he said, the company may have to stop making acquisitions.

Mr. Cummings said that rather than make another bank deal, National City will announce a stock buyback this year.

Though Mr. Cummings said he thinks year-2000 issues at National City may also discourage expansion, Mr. Daberko rejected that idea.

"Year-2000 is not going to slow consolidation too much," Mr. Daberko said. "But the volatility in the stock market will."

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