Two into One

In Wall Street, the common stock of the Brooklyn Trust Co.,* founded 84 years ago, kicked up its heels like any speculative two-year-old last week. In six weeks the stock galloped from $139 to $228, on the rumor that Brooklyn Trust would soon be bought by a larger bank. Last week it jumped $1 7 in one day as the rumor turned out to be true. Brooklyn Trust announced it will merge with Manhattan's Manufacturers Trust Co.

The merger will move Manufacturers up from sixth to fifth biggest U.S. bank./- with more than 100 branches, and the largest neighborhood banking service in one city in the world. This new eminence will be no strain on Manufacturers' President Harvey Dow Gibson. In his nearly 20 years as president of Manufacturers Trust, the bank has already swallowed up six smaller banks, and with this merger has boosted its deposits from $219 million to $2.3 billion. Gibson, who works as hard as any of his banking colleagues, and at 68 plays harder than most of them, still finds time to salmon-fish and ski (see cut), was once Master of Fox Hounds at Long Island's Meadow Brook Hounds. He has poured more than $300,000 of his own money into his home town of North Conway, N.H., to make it a leading ski center in the U.S. (TIME, Jan. 21, 1946).

The Manufacturers-Brooklyn merger will be the biggest New York bank combination in 20 years, but it is not the only one on the fire. Next week the stockholders of the $1.5 billion Bankers Trust Co. will vote on the purchase of the Lawyers Trust Co., only two months after Bankers Trust took over the banking business of the Title Guarantee & Trust Co.

The mergers are part of a long-term trend in New York banking. Since 1900, the number of New York City commercial banks has dwindled from 127 to 59 through mergers. Banks are moving into the mass-loan business, and need branches to do the job right. Where high interest rates once made it profitable to serve a comparatively few big customers, today's low rates and high fixed costs are forcing banks into what amounts to a chain-store operation. With thousands of clients, the banks have made this operation highly profitable with small personal loans and a host of other services they once thought too picayune to bother with.

*Which for 16 years (1929-45) helped run the Brooklyn Dodgers baseball team, as one of the executors of the estate of the late baseball magnate Charles H. Ebbets. After the hapless Dodgers had wallowed in the second division for five years straight, the bank hired Larry MacPhail as general manager in 1938. MacPhail drove the Dodgers to a National League pennant in 1941, paid off a mountain of debts (some $500,000 to the Brooklyn Trust) by 1942. /-The top four: Bank of America, National City Bank of New York, Chase National Bank, and Guaranty Trust Co. of New York.

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