JP Morgan Surges On Takeover Rumours

BBC News Online reports that shares in JP Morgan Chase surged earlier in the week as rumours resurfaced that the financial giant is likely to fall prey to Chicago-based Bank One.

Although Bank One is regarded as a banking minnow when compared to JP Morgan Chase, in actual fact Bank One's market capitalisation started out the week around $5bn higher. JP Morgan Chase's shares are down over 40% on the year.

The rumour has been around for a while and resurfaced this week. Although Bank One is known to be on the acquisition trial, most analysts feel that JP Morgan could be one bank too far. Although the bank would be relatively cheap to buy, it will take a lot of capital to turn it round and it is not as if it is highly profitable at the moment - the giant has only posted one quarter in profit since the Chase / JP Morgan marriage two years ago.

Another rumour doing the rounds in London earlier this week was of a merger between the bank and Morgan Stanley. That seems more likely, although still improbable.

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