Derivatives at Banc One (1994)

Posted: 27 Jun 1998

See all articles by David K. Backus

David K. Backus

NYU Stern School of Business; National Bureau of Economic Research (NBER)

Leora F. Klapper

World Bank; World Bank - Development Research Group (DECRG)

Chris Telmer

Carnegie Mellon University - David A. Tepper School of Business

Abstract

SUBJECT AREAS: Commercial banking, financial derivatives, duration, interest rate swaps, regulation and deregulation, information technology.

REQUESTS FOR COPIES: Please contact David Backus via email: MAILTO:dbackus@stern.nyu.edu

Case Teaching Package: A 2-page Case Teaching Package is available for this case. The Teaching Package includes strategies for case presentation, key concepts, solutions to the assignment questions in the case, and suggestions for the most effective ways to work this case into your course.

Banc One Corporation, a bank holding company headquartered in Columbus, Ohio, has been one of the great success stories of US banking. With roots as a local Columbus bank, twenty-five years of acquisition-driven growth have produced a "super-regional" powerhouse operating, at the end of 1993, in 13 states, with assets of $79.9 billion, an earnings record the envy of the industry, and average annual stock appreciation since 1968 of 16.5%. Growth has been matched by performance, with consistently high returns on assets and equity and an ongoing record of technology-based innovation.

We use Banc One's experience with interest rate swaps to illustrate the management of interest rate risk at a commercial bank. The case also serves as a vehicle for examining the current state of commercial banking in the US, the use and reporting of derivative positions, and the role of information technology in banking management and strategy.

JEL Classification: G13, G21

Suggested Citation

Backus, David K. and Klapper, Leora F. and Telmer, Christopher I., Derivatives at Banc One (1994). Available at SSRN: https://ssrn.com/abstract=102552

David K. Backus (Contact Author)

NYU Stern School of Business

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National Bureau of Economic Research (NBER)

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Leora F. Klapper

World Bank ( email )

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Washington, DC 20433
United States
202-473-8738 (Phone)

HOME PAGE: http://econ.worldbank.org/staff/lklapper

World Bank - Development Research Group (DECRG)

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MSN3-311
Washington, DC 20433
United States

Christopher I. Telmer

Carnegie Mellon University - David A. Tepper School of Business ( email )

5000 Forbes Avenue
Pittsburgh, PA 15213-3890
United States
(412) 268-8838 (Phone)
(412) 268-6837 (Fax)

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