An investor with $5,000 cash can buy outright about 55 shares of the ''average" stock, since the price of all the issues on the Exchange board averages about $90. Yet this same investor could not purchase even a single share of Manhattan's First National Bank, which last week rose 1,200 points in two days and reached a quotation of $7,300 a share. As George F. Baker, board chairman of First National, is said to hold 20,000 shares (there are only 100,000 outstanding) the 1,200-point rise gave him a paper profit of 24 million dollars. Meanwhile shares in Chase, Equitable, and many another Manhattan bank also enjoyed sensational rises. The bull movement in bank stocks was based on the official ratification of the Guaranty Trust Co.-National Bank of Commerce merger (TIME, March 4) and the resultant activity of rumor-spreaders who busily reasserted and consolidated Manhattan's banking map.
Rumors. Most frequently repeated stories were: That the Guaranty Trust Co. and National Bank of Commerce combine would be extended to include the Corn Exchange Bank; that First National would merge with Bankers' Trust; that National City would merge with Equitable Trust Co.; that Chase National would unite with Brooklyn Trust Co. Then there was a truly robust rumor that linked Guaranty Trust Co., National Bank of Commerce, Bankers' Trust and First National in a Morgan-group merger that would be the super bank of all the world. The rumors were all denied and seemed to consist of smoke rather than fire.
Guaranty-Commerce. Merger of Guaranty Trust and National Bank of Commerce, however, was officially established with announcement of officers of the combined institution. No name has been given to the combination, though it was reported that the new bank might be known simply as Guaranty Trust Co., a procedure which would cause Bank of Commerce to pass out of existence in the goth year of its age. As far as merger officers are concerned, Commerce gets the board chairmanship, Guaranty Trust the presidency, as James Strange Alexander, chairman of the board of National Bank of Commerce, and William C. Potter, president of Guaranty Trust, will retain their positions with the merged bank. Charles H. Sabin, board chairman of Guaranty, becomes vice-chairman of the board in the new organization. He will also be full board chairman of Guaranty Co. (the investment subsidiary of Guaranty Trust Co.) which will function for the combined institutions. The merger appears to have swallowed up 49-year-old Stevenson Ward, Commerce president, who figures in the merged bank only as one of a long list of directors. Morgan influence in Guaranty-Commerce is emphasized by the appointment of Thomas William Lament as chairman of the Executive Committee. In some quarters Mr. Lament (whose Morgan label alone prevents him from being entitled foremost U. S. banker) is credited with having virtually arranged the Guaranty-Commerce merger before sailing for Europe to serve on the Reparations Committee.*