Jaime Diamond and Bank One a

626 Words3 Pages
Jaime Dimon and Bank One A Bank One had suffered from very serious problems. These problems included “a number of mergers had not been fully integrated, and political infighting was rampant throughout the company”, “overhead spending was not under control” – meaning the efficiency ratio was low, the moral among employees was low and there were a division between all of them due to past mergers failed to integrate, weak loan quality, First USA – Bank One’s credit card unit – had lost millions of customers due to increasingly dissatisfaction with poor customer service and relatively high interest rates’ and finally, the IT and accounting systems needs huge short-term investments to make improvements, in order to upgrade service levels, manage customer profitability, and improve management accountability. The cultural gap division between the legacy Banc One and the legacy First Chicago NBD employees, the most lethal problem to Bank One, had hindered its chance to make changes in the past to adapt to the new market situations, since the board and the commercial banking divisions did not work as a whole to obtain common goals, hence losing market shares to the competitors. The second big problem was poor documentation across all retail lines, made it difficult to get an accurate picture of the risk profile of the consumer loan portfolio, hence led to handling out bad loans and credits as a result, and made loss of millions of dollars. First USA was the second-largest credit card issuer, yet it had so many flaws, such as low customer satisfaction, payment-processing problems, a shortening of late-fee grace period for some customers, and a very competitive low-interest/zero percent solicitation. These flaws angry the customers, which led to declining in net-interest margin. And that’s not all, once the customer lost his/her trust in the business, it is very hard
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