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Market Update

Bank One Is Trying Shareholders' Patience

Bank One's warning lacks meaningful explanation.

Bank One's (ONE) latest earnings warning may be the final straw for some patient investors.

The company's stock dove 11% on Wednesday afternoon amid rumors that Bank One was canceling Monday's scheduled conference for analysts. The meeting was postponed until January because Bank One apparently hasn't finished uncovering problems in its First USA credit-card unit.

First USA appears to be in deeper trouble than Bank One suspected in August, when the bank first said First USA's customer-service problems would cause the company to miss its 1999 earnings estimate. Shares went into a tailspin and have yet to recover. Now Bank One says its profits may be as much as 4% below the revised-down 1999 consensus estimate of $3.59 per share.

Clearly, Bank One needs time to permanently solve its First USA problems, but the company's treatment of Wednesday's announcement was shameful. Bank One would not say what issues remain at First USA or how they plan to solve them.

Shareholders deserve a better explanation. They've already endured a 40% drop in the value of their Bank One investment in recent months. The company should give them some reassurance that things are looking up--not getting worse.