Case ID: 298016
Solution ID: 22429
Words: 2191
Price $ 75

Chase Manhattan Corp The Making of Americas Largest Bank

Case Solution

Chemical Banking Corporation, since 1840s, has been growing prosperously by acquisitions, introducing a variety of products and expanding in other geographical markets, both domestically and internationally. Its objective was to maximize earnings and become an innovative firm.  On the other hand, Chase Manhattan Corporation had been in operation since 1955. This corporation was formed by a merger of two banks; Bank of Manhattan and Chase national bank. Both of these banks were profitable and well reputed and had grown through acquisition and product development. In times of crisis, both Chase and Chemical had taken steps to reduce costs and close down branches.

Excel Calculations

·         Changes

·         Equity/Asset Ratio

·         Debt/Asset Ratio

·         Return on equity

·         WACC

·         Estimated gains and expenses

·         Total expenses

·         Overall gain

·         NPV

·         NPV calculations

·         Merger Calculations       

·         Common value of merged companies                                   

·         Premium offered                                            

·         Value of chase                                 

·         Value of chase after premium                                   

·         Share price per Chemical share                                 

·         Value of chase in number of Chemical share after premium (amount of shares exchanged)        

·         Shares after merger                                      

·         New share price   

Questions Covered

1.       Overview

2.       Benefits of formation of Chase Manhattan Bank

3.       Risks

4.       Quantitative Factors

5.       Conclusion

6.       Appendix