Brace yourselves for another round of banking consolidation.
Wachovia has made the first move by agreeing to pay $25 billion for Golden West Financial Corp., a West Coast commercial bank with a large mortgage business. In response to the deal, J.P. Morgan Chase & Co. CEO Jamie Dimon told analysts that his bank may consider buying another thrift. Last month, J.P. Morgan bought Bank of New York Co.'s 338 retail bank branches in a complex asset swap.
In response to Dimon's candor with them, the analysts pressed him whether J.P. Morgan was coveting another mortgage lender, Countrywide Financial Corp., according to a Reuters report. Of course, Dimon refused to list possible acquisition candidates.
However, with rival Wachovia expanding west and Bank of America Corp. and Citi already firmly ensconced on the West Coast, odds are Dimon's eyes are on the California. With that in mind, along with the knowledge that Dimon was once Sandy Weil's protege, one could assume his refusal to discuss the Countrywide option has less to do with affirmation that J.P. Morgan is already in talks with the bank, but rather he has bigger fish in mind. He may have Wells Fargo in his sights. Either way, Dimon is heeding the adage, "Go west young man..."—Matthew Wurtzel
See story from Reuters
See related story from Forbes
See Golden West story from The Deal
See Bank of New York story from The Deal
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