BANKING & FINANCE - Oct. 20, 1993
From Times Staff and Wire Reports
2 Major Banks to Hold the Line on Prime Rate: Chemical Banking Corp. and Banc One Corp. said they are unlikely to follow the lead of Morgan Guaranty Trust Co. in dropping its prime interest rate. So far, no big banks have followed Morgan’s surprise decision Monday to drop its rate half a point to 5.5%. Analysts predicted such a cut, if matched by other banks, would hurt bank profitability. Walter V. Shipley, president and chairman-elect of Chemical Banking Corp. of New York, questioned the need for a prime rate cut in the current sluggish economy. A spokesman for Banc One Corp. of Columbus, Ohio, said: “If Chemical, Citicorp and Bank of America lower the prime, then we’d have to take a harder look. But we don’t expect that to happen.”
