---

---




SECURITIES AND
   EXCHANGE COMMISSION





Washington, D.C.
   20549











FORM
   10-K





Annual Report
   Pursuant to Section 13 or 15(d) of





the Securities
   Exchange Act of 1934





For the fiscal
   year ended December 31, 1999


Commission file
   number 001-15323





BANK ONE
   CORPORATION


(Exact name of
   registrant as specified in its charter)











|Delaware                             |  | 31-0738296              
|------------------------------------ |  | ------------------------
|(State or other
     jurisdiction of |  | (I.R.S.
     Employer   
|incorporation or
     organization)  |  | Identification
     No.)




1 Bank One Plaza,
   Chicago, Illinois 60670


(Address of principal
   executive offices including zip code)


Registrants
   telephone number, including area code: (312) 732-4000





Securities
   registered pursuant to Section 12(b) of the Act:





|Title of Each
     Class                                                |  | Name of Each
     Exchange on
   
   which Registered
|----------------------------------------------------------------------- |  | -----------------------------------------------------
|                                                                       
|Common Stock, $0.01
     par value                                      |  | New York Stock
     Exchange                         
|                                                                        |  | Chicago Stock
     Exchange                          
|Preferred Stock
     with Cumulative and Adjustable Dividends, Series B |  | New York Stock
     Exchange                         
|($100 stated value), $0.01 par value                                    |  |                                                      
|Preferred Stock
     with Cumulative and Adjustable Dividends, Series C |  | New York Stock
     Exchange                         
|($100 stated value), $0.01 par value                                    |  |                                                      
|71/4% Subordinated
     Debentures Due 2004                             |  | New York Stock
     Exchange                         
|8.10% Subordinated
     Notes Due 2002                                  |  | New York Stock
     Exchange                         
|Guarantee of 8.00%
     Preferred Securities of BANK ONE Capital I      |  | New York Stock
     Exchange                         




Securities
   registered pursuant to Section 12(g) of the Act:None.





Indicate by check mark whether the
   registrant (1) has filed all reports required to be filed by Section 13 or
   15(d) of the Securities Exchange Act of 1934 during the preceding 12 months,
   and (2) has been subject to such filing requirements for the past 90 days.
     Yes [ ü ] No [  
     ]





Indicate by check mark if disclosure of
   delinquent filers pursuant to Item 405 of Regulation S-K is not contained
   herein, and will not be contained, to the best of the registrants
   knowledge, in definitive proxy or information statements incorporated by
   reference in Part III of this Form 10-K or any amendment to this Form 10-K.
   [ ü ]





The aggregate market value of voting
   stock held by nonaffiliates of the Corporation at December 31,
 
 1999, was approximately $27,500,000,000 (based on the average price of such
   stock on February 25, 2000). At December 31, 1999, the Corporation had
   1,147,343,082 shares of its Common Stock, $0.01 par value,
   outstanding.





DOCUMENTS
   INCORPORATED BY REFERENCE





Portions of the
   Corporations definitive proxy statement dated March 27, 2000, are
   incorporated by reference into Part III hereof.





---

---

BANK ONE
   CORPORATION





Form 10-K
   Index





|                                     |  |                                                                                                             |  | Page
|------------------------------------ |  | ----------------------------------------------------------------------------------------------------------- |  | ----
|PART I                               | 
|Financial Review                     |  | 2                                                                                                          
|                                     |  | Selected Financial Data                                                                                     |  | 2   
|                                     |  | Business Segments                                                                                           |  | 3   
|                                     |  | Earnings Analysis                                                                                           |  | 10  
|                                     |  | Risk Management                                                                                             |  | 15  
|                                     |  | Liquidity Risk Management                                                                                   |  | 16  
|                                     |  | Market Risk Management                                                                                      |  | 17  
|                                     |  | Credit Risk Management                                                                                      |  | 21  
|                                     |  | Derivative Financial Instruments                                                                            |  | 30  
|                                     |  | Loan Securitizations                                                                                        |  | 32  
|                                     |  | Year 2000 Readiness Disclosure                                                                              |  | 33  
|                                     |  | Capital Management                                                                                          |  | 33  
|                                     |  | Forward-Looking Statements                                                                                  |  | 36  
|                                     |  | Consolidated Financial Statements                                                                           |  | 38  
|                                     |  | Notes to Consolidated Financial Statements                                                                  |  | 42  
|                                     |  | Report of Independent Public Accountants                                                                    |  | 74  
|                                     |  | Selected Statistical Information                                                                            |  | 75  
|Item 1.                              |  | Business                                                                                                    |  | 85  
|                                     |  | Description of Business                                                                                     |  | 85  
|                                     |  | Employees                                                                                                   |  | 87  
|                                     |  | Competition                                                                                                 |  | 87  
|                                     |  | Monetary Policy and Economic Controls                                                                       |  | 87  
|                                     |  | Supervision and Regulation                                                                                  |  | 88  
|                                     |  | Financial Review                                                                                            |  | 92  
|Item 2.                              |  | Properties                                                                                                  |  | 93  
|Item 3.                              |  | Legal
      Proceedings                                                                                     |  | 93  
|Item 4.                              |  | Submission of
      Matters to a Vote of Security Holders                                                   |  | 93  
|Executive Officers of the Registrant |  | 93                                                                                                         
|PART II                              | 
|Item 5.                              |  | Market for
       Registrants Common Equity and Related Stockholder
       Matters                         |  | 94  
|Item 6.                              |  | Selected
       Financial Data                                                                              |  | 94  
|Item 7.                              |  | Managements
       Discussion and Analysis of Financial Condition and Results of
       Operations         |  | 94  
|Item 7A.                             |  | Quantitative and
       Qualitative Disclosures About Market Risk                                           |  | 94  
|Item 8.                              |  | Financial
       Statements and Supplementary Data                                                          |  | 94  
|Item 9.                              |  | Changes in and
       Disagreements with Accountants on Accounting and Financial
     
          Disclosure |  | 94  
|PART III                             | 
|Item 10.                             |  | Directors and
        Executive Officers of the Registrant                                                  |  | 94  
|Item 11.                             |  | Executive
        Compensation                                                                              |  | 94  
|Item 12.                             |  | Security
        Ownership of Certain Beneficial Owners and Management                                      |  | 95  
|Item 13.                             |  | Certain
        Relationships and Related Transactions                                                      |  | 95  
|PART IV                              | 
|Item 14.                             |  | Exhibits,
         Financial Statement Schedules and Reports on Form 8-K                                    |  | 95  




In this document,
       the Corporation refers to BANK ONE CORPORATION; Banc
       One refers to BANC ONE CORPORATION; and FCN refers to
       First Chicago NBD Corporation. The Corporation is the result of the
       merger, effective October 2, 1998, of Banc One and FCN (the Merger
       ), further described herein.





FINANCIAL REVIEW





SELECTED
     FINANCIAL
     DATA





|(In
         millions, except ratios and per-share data)  |  | 1999                  |   | 1998 |                       | 1997 |  | 1996                  |   | 1995
|--------------------------------------------------------- |  | --------------------- | - | ---- | --------------------- | ---- |  | --------------------- | - | ----
|Income and
         Expense:                              |  |                       |   |      |                       |      |  |                       |   |     
|Net interest
         incometax-equivalent basis         |  | $  
           9,142  |   |      | $  
           9,469  |      |  | $  
           9,619  |   |     
|Provision for
         credit losses                      |  | 1,249                 |   |      | 1,408                 |      |  | 1,988                 |   |     
|Noninterest
         income                               |  | 8,692                 |   |      | 8,071                 |      |  | 6,694                 |   |     
|Merger-related
         and restructuring charges         |  | 554                   |   |      | 1,062                 |      |  | 337                   |   |     
|Operating
         expense                                |  | 10,936                |   |      | 10,483                |      |  | 9,403                 |   |     
|Net
         income                                       |  | 3,479                 |   |      | 3,108                 |      |  | 2,960                 |   |     
|Per Common
         Share Data:                           |  |                       |   |      |                       |      |  |                       |   |     
|Net income,
         basic                                |  | $  
             2.97 |   |      | $  
             2.65 |      |  | $  
             2.48 |   |     
|Net income,
         diluted                              |  | 2.95                  |   |      | 2.61                  |      |  | 2.43                  |   |     
|Cash dividends
         declared                          |  | 1.68                  |   |      | 1.52                  |      |  | 1.38                  |   |     
|Book
         value                                       |  | 17.34                 |   |      | 17.31                 |      |  | 16.03                 |   |     
|Balance
         Sheet:                                   |  |                       |   |      |                       |      |  |                       |   |     
|Loans                                                     |  | $163,877              |   |      | $155,398              |      |  | $159,579              |   |     
|Deposits                                                  |  | 162,278               |   |      | 161,542               |      |  | 153,726               |   |     
|Long-term debt
         (1)                               |  | 35,435                |   |      | 22,298                |      |  | 21,546                |   |     
|Total
         assets                                     |  | 269,425               |   |      | 261,496               |      |  | 239,372               |   |     
|Common
         stockholders equity                      |  | 19,900                |   |      | 20,370                |      |  | 18,724                |   |     
|Total
         stockholders equity                       |  | 20,090                |   |      | 20,560                |      |  | 19,050                |   |     
|Performance
         Ratios:                              |  |                       |   |      |                       |      |  |                       |   |     
|Return on
         assets                                 |  | 1.36                  | % |      | 1.30                  | %    |  | 1.29                  | % |     
|Return on
         common equity                          |  | 17.1                  |   |      | 15.9                  |      |  | 15.8                  |   |     
|Net interest
         margin                              |  | 4.09                  |   |      | 4.52                  |      |  | 4.75                  |   |     
|Efficiency
         ratio                                 |  | 64.4                  |   |      | 65.8                  |      |  | 59.7                  |   |     
|Credit
         Quality:                                  |  |                       |   |      |                       |      |  |                       |   |     
|Net charge-offs
         to average loans                 |  | 0.77                  | % |      | 0.97                  | %    |  | 1.21                  | % |     
|Allowance for
         credit losses to loans outstanding |  | 1.39                  |   |      | 1.46                  |      |  | 1.77                  |   |     
|Nonperforming
         assets to related assets           |  | 0.71                  |   |      | 0.53                  |      |  | 0.42                  |   |     
|Common Stock
         Data:                               |  |                       |   |      |                       |      |  |                       |   |     
|Average shares
         outstanding, basic                |  | 1,168                 |   |      | 1,170                 |      |  | 1,176                 |   |     
|Average shares
         outstanding, diluted              |  | 1,178                 |   |      | 1,189                 |      |  | 1,213                 |   |     
|Stock price,
         year-end                            |  | $  
           32.00  |   |      | $  
           51.06  |      |  | $  
           49.37  |   |     
|Stock
         dividends                                  |  |                      |   |      | 10                    | %    |  |                      |   |     
|Dividend payout
         ratio                            |  | 57                    | % |      | 58                    | %    |  | 61                    | % |     







|(1) | Includes trust
         preferred capital securities.
|--- | -----------------------------------------------------




BUSINESS
     SEGMENTS





Highlights





|                                                                        |  | Net Income
       
       (In millions) |   | Earnings
       
       Per Share |                  | Return on
       
       Equity |  | Average
       
       Managed Assets
       
       (In billions) |   | Average
       
       Common Equity
       
       (In billions)
|----------------------------------------------------------------------- |  | --------------------------------------- | - | --------------------------------- | ---------------- | ------------------------------- |  | ------------------------------------------------------------------ | - | -----------------------------------------------------------------
|
|Commercial
         Banking                                             |  | $1,612                                  |   |                                   | $1,325           |                                 |  | $1.37                                                              |   |                                                                  
|First
         USA                                                      |  | 1,255                                   |   |                                   | 1,419            |                                 |  | 1.07                                                               |   |                                                                  
|Other
         Consumer                                                 |  | 940                                     |   |                                   | 783              |                                 |  | 0.80                                                               |   |                                                                  
|Other
         Activities and
       
            Corporate/Unallocated |  | 269                                     |   |                                   | 342              |                                 |  | 0.22                                                               |   |                                                                  
|                                                                        |  |                                         |   |                                   |                  |                                 |  |                                                                    |   |                                                                  
|Managed
         Business Segment
       
            results           |  | 4,076                                   |   |                                   | 3,869            |                                 |  | 3.46                                                               |   |                                                                  
|Merger-related
         and other
       
            items             |  | (597                                    | ) |                                   | (761             | )                               |  | (0.51                                                              | ) |                                                                  
|                                                                        |  |                                         |   |                                   |                  |                                 |  |                                                                    |   |                                                                  
|Total
         Corporation                                              |  | $3,479                                  |   |                                   | $3,108           |                                 |  | $2.95                                                              |   |                                                                  
|                                                                        |  |                                         |   |                                   |                  |                                 |  |                                                                    |   |                                                                  
|Investment
         Management
       
            (included above)     |  | $ 
          344                        |   |                                   | $ 
          215 |                                 |  | $0.29                                                              |   |                                                                  
|                                                                        |  |                                         |   |                                   |                  |                                 |  |                                                                    |   |                                                                  







N/MNot
       meaningful.





Business
       Segment Management





BANK ONE CORPORATION manages its
       lines of business based on risk, return and growth parameters. The risk
       component is differentiated through the capital allocation process.
       Merger-related charges and certain other items that are not considered
       core, run-rate items were not attributed to the line of business
       results. Management believes that the results presented are more
       indicative of underlying performance of the business
       segments.





Description of
       Methodology





Key elements of the management
       reporting process that determine the line of business results
       include:





| | · | Funds Transfer
         PricingTo derive net interest income for the business units, a
         detailed process of charging/crediting for assets/liabilities is
         employed. This system is designed to be consistent with the Corporation
         s asset and liability management principles.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




| | · | Standard Credit
         CostsProvision for credit losses in the lines of business is
         determined through specific methodologies that measure expected loss
         over a certain period of time. Any difference between the aggregate
         provision of the businesses and the Corporations total is shown
         in Corporate/Unallocated.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




| | · | Cost Allocation
         Costs of support units are fully allocated to the business lines
         as indirect expenses and overhead costs.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------




| | · | Capital
         AttributionCommon equity is assigned to the business units based
         on the underlying risk of their activities. Four forms of risk are
         measured: credit, market, operational and lease residual. The risk
         tolerance used in this framework is consistent with that required for
         a AA debt rating. See page 34 for more information on economic
         capital.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




To the extent practicable, results
       for prior periods have been restated to reflect subsequent
       organizational changes and material refinements in management reporting
       policies.





Other key principles underlying the
       line of business results are noted below.





| | · | The
         presentation of the business units depicts the management organization
         of the Corporation for 1999. During that time, the Consumer Lending
         unit operated as part of First USA. In January 2000, Consumer
       Lending was realigned with Retail Banking. Other, less significant,
         changes also took place as noted on page 9. The business segments
          results for 1999 and 1998 are presented under the 2000
         organization structure on page 9.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




| | · | The
         merger-related charges and the effect of certain identified
         transactions were not attributed to any line of business. For
         analytical purposes, these items are not considered part of the core
         business activities. More information on these costs is provided
         beginning on page 8.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




| | · | All disclosures
         are on a managed basis; securitized credit card receivables and
         related income statement line items are presented as if they were
         on-balance sheet loans.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




| | · | Earnings from
         Investment Management are fully attributed to the other lines of
         business.
| | - | ----------------------------------------------------------------------------------------------------------




| | · | The Other
         Activities/Unallocated category includes certain proprietary
         investing and other small non-core business activities, as well as
         unallocated capital and other corporate items.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




Line of
       Business Financial Results





Commercial
       Banking





|(Dollars in
         millions)       |  | 1999              |   | 1998 |                   | %
         Change
|------------------------------------ |  | ----------------- | - | ---- | ----------------- | -----------------
|Net interest
         income (FTE)   |  | $3,017            |   |      | $2,942            |                  
|Provision for
         credit losses |  | 437               |   |      | 404               |                  
|Noninterest
         income          |  | 2,605             |   |      | 2,237             |                  
|Noninterest
         expense         |  | 2,934             |   |      | 2,925             |                  
|Net
         income                  |  | 1,612             |   |      | 1,325             |                  
|                                     |  |                   |   |      |                   |                  
|Return on
         equity            |  | 21                | % |      | 17                | %                
|Efficiency
         ratio            |  | 52                |   |      | 56                |                  
|                                     |  |                   |   |      |                   |                  
|(Dollars in
         billions)       |  |                   |   |      |                   |                  
|Average
         loans               |  | $ 
          83.1 |   |      | $ 
          77.0 |                  
|Average
         assets              |  | 151.9             |   |      | 143.1             |                  
|Average common
         equity       |  | 7.7               |   |      | 7.7               |                  







FTEFully
       taxable equivalent.





Commercial Banking is the Corporation
       s largest earnings contributor, representing 40% of managed
       business segment net income. It serves business customers ranging in
       size from middle market companies to large corporations, governments and
       institutions. Commercial Bankings offerings include traditional
       credit products, corporate finance, treasury services, investment
       management and capital market products. This business lines
       earnings also include the results of high net worth customers, leveraged
       and equipment leasing, proprietary investing and venture capital
       activities.





Net income of $1.6 billion for 1999
       was up 22% from a year ago, and return on equity increased to 21%. This
       performance exceeded the growth and return targets established for this
       business. Spread income was up 3%, although margins continued to be
       compressed. The 16% improvement in noninterest income was principally
       due to significantly higher market-driven revenue in Corporate
       Investments and an increase in treasury management fees. The provision
       for credit losses increase reflected the impact of 8% loan growth in
       1999. Noninterest expense was flat year-to-year, reflecting merger
       synergies and expense discipline.





The $7.7 billion of average common
       equity attributed to Commercial Banking is predicated on the assessment
       of inherent business risks. It represents about 9% of total average
       loans.





For 2000, the activities of
       Commercial Banking are expected to produce net income growth in the 13%
       16% range. Overall, return on equity should be 18%
       20%.





Consumer
       Businesses





The Corporation serves a number of
       different consumer markets with a variety of products and through
       multiple delivery channels. For 1999, the consumer businesses consisted
       of First USA (including Credit Card, WingspanBank.com (the Corporation
       s Internet-only bank) and Consumer Lending) and Other Consumer.
       Deposit gathering, auto finance and small business lending were the
       primary activities of Other Consumer.





First
       USA


(Credit Card
       and Consumer Lending)





|(Dollars in
         millions)       |  | 1999   |   | 1998 |                     | %
         Change
|------------------------------------ |  | ------ | - | ---- | ------------------- | -----------------
|Net interest
         income (FTE)   |  | $7,980 |   |      | $7,519              |                  
|Provision for
         credit losses |  | 3,843  |   |      | 3,485               |                  
|Noninterest
         income          |  | 2,155  |   |      | 1,960               |                  
|Noninterest
         expense         |  | 4,393  |   |      | 3,873               |                  
|Net
         income                  |  | 1,255  |   |      | 1,419               |                  
|                                     | 
|Return on
          equity           |  | 17     | % |      | 21                  | %                
|Efficiency
          ratio           |  | 43     |   |      | 41                  |                  
|                                     | 
|(Dollars
           in billions)     |  |        |   |      |                     |                  
|Average
           loans             |  | $100.7 |   |      | $ 
            91.2 |                  
|Average
           common equity     |  | 7.4    |   |      | 6.8                 |                  




Credit
         Card





|(Dollars
           in millions)            |  | 1999                  |   | 1998 |                       | %
           Change
|------------------------------------------- |  | --------------------- | - | ---- | --------------------- | -------------------
|Net interest
           income (FTE)        |  | $6,895                |   |      | $6,457                |                    
|Provision for
           credit losses      |  | 3,593                 |   |      | 3,274                 |                    
|Noninterest
           income               |  | 1,860                 |   |      | 1,628                 |                    
|Noninterest
           expense              |  | 3,533                 |   |      | 3,054                 |                    
|Net
           income                       |  | 1,077                 |   |      | 1,177                 |                    
|                                            | 
|Return on
            outstandings (pretax) |  | 2.4                   | % |      | 2.9                   | %                  
|Return on
            equity                |  | 17                    |   |      | 21                    |                    
|Efficiency
            ratio                |  | 40                    |   |      | 38                    |                    
|Managed net
            charge-off rate     |  | 5.23                  |   |      | 5.57                  |                    
|                                            | 
|(Dollars
             in billions)          |  |                       |   |      |                       |                    
|Average
             loans                  |  | $ 
              69.0 |   |      | $ 
              60.5 |                    
|Average
             assets                 |  | 75.3                  |   |      | 65.7                  |                    
|Average
             common equity          |  | 6.2                   |   |      | 5.6                   |                    




For the year, Credit Card
           contributed $1.1 billion of net income, an 8% reduction from 1998.
           Managed credit card receivables averaged $69 billion for the year,
           up 14% from 1998, yet relatively flat during the year. Total revenue
           rose 8% for 1999, a result of the receivables growth. Expenses were
           up 16%, largely due to higher marketing costs, which, beginning in
           the fourth quarter of 1998, were expensed as incurred rather than
           capitalized. Higher servicing costs associated with portfolio
           growth, and investments in new markets also contributed to the
           expense increase.





Return on equity for 1999
           was 17%, based on an equity attribution of 9% of managed
           receivables. This capital ratio is generally higher than that of
           most competitors. The managed net charge-off rate for 1999 was
           5.23%, compared with 5.57% in 1998.





A rapid earnings decline
           occurred in the second half of 1999 and was due to several factors:
           a rise in account attrition, significant yield compression and a
           reduction in late fees. As a result, the net interest margin dropped
           almost 75 basis points in the second half of the year.





During the second half
           of 1999, Credit Card refocused its marketing efforts on customer
           retention, addressed operational and service issues, and deployed a
           revised pricing strategy. Expense management programs have also been
           implemented. Overall, Credit Cards earnings are expected to
           decline in 2000, to a pretax return on outstandings of approximately
           1.0%. The actions initiated in 2000 are expected to return Credit
           Card profitability for 2001 to industry levels.





Consumer
           Lending





|(Dollars
             in millions)       |  | 1999                    |   | 1998 |                         | %
             Change
|---------------------------------------- |  | ----------------------- | - | ---- | ----------------------- | ---------------------
|Net
             interest income (FTE)   |  | $1,085                  |   |      | $1,062                  |                      
|Provision
             for credit losses |  | 250                     |   |      | 211                     |                      
|Noninterest
             income          |  | 295                     |   |      | 332                     |                      
|Noninterest
             expense         |  | 860                     |   |      | 819                     |                      
|Net
             income                  |  | 178                     |   |      | 242                     |                      
|                                         | 
|Return on
              equity           |  | 15                      | % |      | 20                      | %                    
|Efficiency
              ratio           |  | 62                      |   |      | 59                      |                      
|                                         | 
|(Dollars in billions)                    |  |                         |   |      |                         |                      
|Average
               loans             |  | $ 
                31.7 |   |      | $ 
                30.7 |                      
|Average
               assets            |  | 32.8                    |   |      | 31.3                    |                      
|Average
               common equity     |  | 1.2                     |   |      | 1.2                     |                      




Consumer Lending offers
             a wide range of loan products, including home equity loans and
             lines of credit, mortgage loans, tax refund anticipation loans and
             other secured loans. These loans are generated nationwide through
             a variety of distribution channels, including telemarketing,
             direct mail, retail banking centers, the Internet and third-party
             originators.





Net income declined
             substantially in 1999 as credit costs rose. Provision for credit
             losses reflects higher charge-offs due to portfolio seasoning and
             growth. In addition, gains on loan sales and securitizations for
             1999 were lower by $28 million. Increased direct marketing and
             other channel costs were also a factor in the earnings
             decline.





Consumer Lending was
             merged into Retail Banking in early 2000 with the objective of
             serving customers more effectively by offering a full product set
             through integrated channel access. This combination will leverage
             infrastructure and processes in order to improve the operating
             efficiency and returns of Consumer Lending from run-rate levels at
             year-end 1999.





Other
             Consumer





|(Dollars in millions)                      |  | 1999                      |   | 1998 |                           | %
               Change
|------------------------------------------ |  | ------------------------- | - | ---- | ------------------------- | -----------------------
|Net
               interest income (FTE)   |  | $3,304                    |   |      | $3,230                    |                        
|Provision
               for credit losses |  | 165                       |   |      | 246                       |                        
|Noninterest income                         |  | 1,424                     |   |      | 1,590                     |                        
|Noninterest expense                        |  | 3,144                     |   |      | 3,395                     |                        
|Net
               income                  |  | 940                       |   |      | 783                       |                        
|                                           | 
|Return
                on equity           |  | 26                        | % |      | 23                        | %                      
|Efficiency ratio                           |  | 66                        |   |      | 70                        |                        
|                                           | 
|(Dollars in billions)                      |  |                           |   |      |                           |                        
|Average
                 loans             |  | $
                   34.5 |   |      | $ 
                  31.5 |                        
|Average
                 assets            |  | 40.0                      |   |      | 36.2                      |                        
|Average
                 deposits          |  | 88.5                      |   |      | 92.1                      |                        
|Average
                 common equity     |  | 3.6                       |   |      | 3.4                       |                        




Other Consumer
               includes a Retail Banking network of 1,800 banking centers,
               7,000 ATMs, online banking and other distribution channels, as
               well as small business, indirect auto lending and other forms of
               secured lending. This business segment produced growth and
               returns above its targets for 1999. Net income was $940
             million, up 20% from 1998, and return on equity was 26%. The
               increase in net income is largely attributable to a lower
               provision for credit losses resulting from a favorable credit
               quality environment and the sale of high risk indirect auto
               lending assets.





Over the past
               two years, the Corporation has sold 245 banking centers with
               approximately $6.5 billion in deposits. Although these sales
               reduced earnings, return on equity and operating efficiency
               improved as a result. At the same time, aggressive productivity
               programs boosted net income. In 1999, average deposit levels
               were $88.5 billion, and average loan balances increased to
               $34.5 billion.





For 2000, the
               new Retail Banking segment (the combination of Other Consumer
               and Consumer Lending) is targeting continued strict expense
               management and moderate revenue growth to produce earnings
               growth of 8%10% and return on equity above
               20%.





Investment Management





|(Dollars in millions)                            |  | 1999                     |  | 1998                     |  | %
                  Change
|------------------------------------------------ |  | ------------------------ |  | ------------------------ |  | --------------------------
|Total
                 revenue                   |  | $1,460                   |  | $1,210                   |  | 21                        
|Noninterest expense                              |  | 940                      |  | 887                      |  | 6                         
|Net
                 income                      |  | 344                      |  | 215                      |  | 60                        
|                                                 | 
|
|Average
                 assets under management |  | $125.1                   |  | $108.7                   |  | 15                        
|                                                 | 
|
|Net
                 income attribution:         |  |                          |  |                          |  |                           
|Commercial                                       |  | $
                   201 |  | $ 
                  124 |  | 62                        
|Credit
                 Card                     |  | 88                       |  | 38                       |  | N/M                       
|Other
                 Consumer                  |  | 55                       |  | 53                       |  | 4                         




N/M
               Not meaningful.





Investment
               Management provides investment advisory, insurance, trust and
               investment-related services to individual and institutional
               clients. The One Group® mutual funds, the Corporations
               proprietary fund family, is managed in this line of business.
               Both equity and fixed income components of the One Group funds
               collectively performed above industry averages in
               1999.





Investment
               Management continues to be a high-growth, high-return business
               for the Corporation. Average assets under management grew 15%
               for the year, and net income rose 60% to $344 million. The
               increase in net income was produced by revenue growth in the
               proprietary insurance, annuity and mutual fund products as well
               as commissions on sales of other securities products. These
               revenues are attributed to the other business lines.





Continued strong
               revenue growth and expense management is expected to generate
               earnings growth of 18%22% for 2000.





Other
               Activities





|(Dollars in millions)                  |  | 1999                     |  | 1998                     |  | %
                  Change
|-------------------------------------- |  | ------------------------ |  | ------------------------ |  | --------------------------
|Total
                 revenue         |  | $149                     |  | $183                     |  | (19                       
|Noninterest expense                    |  | 87                       |  | 90                       |  | (3                        
|Net
                 income            |  | 41                       |  | 59                       |  | (31                       
|                                       | 
|
|Average
                 assets        |  | $
                   2.2 |  | $ 
                  2.6 |  | (15                       
|Average
                 common equity |  | 0.2                      |  | 0.2                      |  |                          




Other Activities
               includes the results of certain proprietary investing and other
               small, non-core business units. Revenue consists principally of
               spread income and gains from equity securities.





Corporate/Unallocated





|(Dollars in millions)                  |  | 1999                       |   | 1998 |                            | %
                  Change
|-------------------------------------- |  | -------------------------- | - | ---- | -------------------------- | --------------------------
|Total
                 revenue         |  | $
                  296    |   |      | $
                  237    |                           
|Provision for credit losses            |  | (107                       | ) |      | (221                       | )                         
|Noninterest expense                    |  | 60                         |   |      | 33                         |                           
|Net
                 income            |  | 228                        |   |      | 283                        |                           
|                                       | 
|
|Average
                 common equity |  | $
                     1.4 |   |      | $ 
                    1.4 |                           




Certain
               corporate transactions, valuation adjustments and charges are
               not allocated to a specific business unit. Additionally, capital
               that is not attributed to businesses is held in
               Corporate/Unallocated. In 1999, this segment included higher
               gains from the sales of banking centers, properties, businesses
               and loan portfolios, which are not considered ongoing specific
               business activities. Also, the difference between standard
               credit costs in the business lines and the Corporations
               actual provision expense is reflected in this
               category.





Merger-Related and Other Items





The Corporation
               s results for the past two years included items that
               management believes were not indicative of ongoing business
               segment results nor would be representative of a prospective
               core run rate of the segments performance. These include
               merger-related restructuring costs, specific business
               restructurings, identified asset impairment and valuation
               adjustments, as well as other items. The following table
               summarizes these items on a pretax basis, which should be
               evaluated in conjunction with reported results.





|(In
                 millions)                                                                      |  | 1999                      |   | 1998
|--------------------------------------------------------------------------------------------------- |  | ------------------------- | - | ----
|Merger
                 and restructuring costs                                                     |  |                           |   |     
|Banc
                 One/FCN                                                                       |  | $(515                     | ) |     
|First
                 Commerce acquisition                                                         |  |                          |   |     
|                                                                                                    | 
|Business restructuring charges                                                                      |  |                           |   |     
|1999
                 fourth quarter                                                                |  | (207                      | ) |     
|Rapid
                 Cash                                                                         |  |                          |   |     
|                                                                                                    | 
|Asset
                 impairment and valuation adjustments                                         |  |                           |   |     
|Auto
                 leasing residuals/other                                                       |  | (80                       | ) |     
|Credit
                 card assets                                                                 |  | (129                      | ) |     
|                                                                                                    | 
|Other
                 items                                                                        |  |                           |   |     
|Provision for credit losses and other charges associated
                 with FFIEC implementation |  | (197                      | ) |     
|Litigation and other charges                                                                        |  | (112                      | ) |     
|Gain on
                 sale of Concord/EPS                                                        |  | 111                       |   |     
|Gain on
                 Indiana divestiture                                                        |  | 249                       |   |     
|Gains
                 from Retail Delivery Initiative                                              |  |                          |   |     
|                                                                                                    |  |                           |   |     
|Total
                 net charges                                                                  |  | $
                   (880 | ) |     
|                                                                                                    |  |                           |   |     
|Earnings per share impact                                                                           |  | $(0.51                    | ) |     
|                                                                                                    |  |                           |   |     




1999
               Business Restructuring, Asset Impairment and Other Nonrecurring
               Items





The 1999 fourth
               quarter business restructuring charges totaled $207 million.
               These costs included personnel-related severance and other exit
               costs associated with both corporate and business-related
               restructuring plans that were approved before year-end 1999. The
               net reduction in full-time equivalent positions is anticipated
               to approximate 5,100, with an estimated severance cost of $143
               million. Other charges of $64 million included asset write-offs
               and termination costs associated with lease and other vendor
               contracts.


Asset
               impairment charges totaled $209 million. Of the total, $80
               million related to the deterioration of automobile lease
               residual values. The remaining $129 million was for the
               impairment of credit card assets, including purchased account
               relationships, affinity programs and interest-only strip
               securities. These charges were triggered by the revised
               marketing plans and projected earnings decline at First USA. The
               carrying values of these assets continue to be subject to
               ongoing market risk, including interest and payment rate risk,
               as well as the automobile resale market. Adverse market changes
               could result in additional impairment charges in future
               periods.





All other
               charges were $309 million. Of this total, $176 million was for
               an increase in provisions for credit losses, reflecting the
               Corporations overall assessment of its allowance for
               credit losses in light of the Federal Financial Institutions
               Examination Councils (FFIEC) new guidelines
               and other relevant risk factors. An additional $21 million of
               noninterest expense for credit card fraud losses was related to
               the shorter time frame for recognizing fraud losses required by
               the new guidelines. The remaining $112 million were reserves
               established to cover various legal matters, as well as other
               asset write-offs associated with system and business integration
               activities.





See Note 5,
               beginning on page 47, for more detail on the 1999 merger-related
               and other restructuring costs. Also, for additional disclosure
               regarding the Corporations business segments, see Note 6
               on page 49.





Line
               of Business Reorganization





The following
               table illustrates line of business results for 1999 and 1998
               restated to reflect the organizational changes that were
               effective January 1, 2000. These changes include: combining
               Consumer Lending with Other Consumer (together defined as
               Retail), moving the Global Money Markets & Investments
               business from Commercial Banking to Other Activities, separating
               the results of WingspanBank.com from Credit Card to Other
               Activities and transferring Private Banking from Commercial to
               Investment Management. Reporting in 2000 will be presented under
               this organizational structure.


|1999
               
               (Dollars in millions) |  | Commercial
               
               Banking |   | Credit
               
               Card |                           | Retail |  | Other
               
               Activities |   | Unallocated |                          | Managed
               
               Business
               
               Segment
               
               Results
|--------------------------------------------------------- |  | ------------------------------------------------- | - | ------------------------------------------ | ------------------------- | ------ |  | ----------------------------------------------- | - | ----------- | ------------------------ | -----------------------------------------------------------------------------------------------------------------------------
|Net
                 interest income (FTE)                |  | $3,027                                            |   |                                            | $6,895                    |        |  | $4,389                                          |   |             | $
                   28  |                                                                                                                              
|Provision for credit losses                               |  | 437                                               |   |                                            | 3,593                     |        |  | 415                                             |   |             |                         |                                                                                                                              
|Noninterest income                                        |  | 2,298                                             |   |                                            | 1,858                     |        |  | 1,719                                           |   |             | 420                      |                                                                                                                              
|Noninterest expense                                       |  | 2,917                                             |   |                                            | 3,444                     |        |  | 4,004                                           |   |             | 193                      |                                                                                                                              
|Net
                 income                               |  | 1,425                                             |   |                                            | 1,135                     |        |  | 1,118                                           |   |             | 170                      |                                                                                                                              
|                                                          | 
|Return
                 on equity                         |  | 20                                                | % |                                            | 18                        | %      |  | 24                                              | % |             | N/M                      |                                                                                                                              
|Efficiency ratio                                          |  | 55                                                |   |                                            | 39                        |        |  | 66                                              |   |             | N/M                      |                                                                                                                              
|Return
                 on outstandings (pretax)          |  | N/A                                               |   |                                            | 2.5                       |        |  | N/A                                             |   |             | N/A                      |                                                                                                                              
|
|                                                          | 
|Average
                 loans                            |  | $
                   83.1                         |   |                                            | $
                   69.0 |        |  | $
                   66.2                       |   |             | $
                   0.3 |                                                                                                                              
|Average
                 managed assets                   |  | 117.9                                             |   |                                            | 75.3                      |        |  | 72.8                                            |   |             | 36.2                     |                                                                                                                              
|Average
                 common equity                    |  | 7.2                                               |   |                                            | 6.2                       |        |  | 4.7                                             |   |             | 0.8                      |                                                                                                                              
|                                                          | 
|
|
|Net
                 interest income (FTE)                |  | $2,841                                            |   |                                            | $6,457                    |        |  | $4,293                                          |   |             | $144                     |                                                                                                                              
|Provision for credit losses                               |  | 404                                               |   |                                            | 3,274                     |        |  | 457                                             |   |             |                         |                                                                                                                              
|Noninterest income                                        |  | 1,990                                             |   |                                            | 1,628                     |        |  | 1,920                                           |   |             | 388                      |                                                                                                                              
|Noninterest expense                                       |  | 2,902                                             |   |                                            | 3,054                     |        |  | 4,214                                           |   |             | 113                      |                                                                                                                              
|Net
                 income                               |  | 1,109                                             |   |                                            | 1,177                     |        |  | 1,024                                           |   |             | 276                      |                                                                                                                              
|                                                          | 
|Return
                 on equity                         |  | 15                                                | % |                                            | 21                        | %      |  | 22                                              | % |             | N/M                      |                                                                                                                              
|Efficiency ratio                                          |  | 60                                                |   |                                            | 38                        |        |  | 68                                              |   |             | N/M                      |                                                                                                                              
|Return
                 on outstandings (pretax)          |  | N/A                                               |   |                                            | 2.9                       |        |  | N/A                                             |   |             | N/A                      |                                                                                                                              
|                                                          | 
|
|Average
                 loans                            |  | $ 
                  77.0                         |   |                                            | $ 
                  60.5 |        |  | $ 
                  62.2                       |   |             | $ 
                  0.2 |                                                                                                                              
|Average
                 managed assets                   |  | 113.1                                             |   |                                            | 65.7                      |        |  | 67.5                                            |   |             | 32.6                     |                                                                                                                              
|Average
                 common equity                    |  | 7.3                                               |   |                                            | 5.6                       |        |  | 4.6                                             |   |             | 0.6                      |                                                                                                                              




N/M
               Not meaningful.


N/A
               Not applicable.








The following
               results for Investment Management are fully attributed to the
               other lines of businesses in the preceding table.





|(Dollars in millions)          |  | 1999   |  | 1998  
|------------------------------ |  | ------ |  | ------
|Total
                 revenue |  | $1,799 |  | $1,523
|Noninterest expense            |  | 1,065  |  | 1,016 
|Net
                 income    |  | 485    |  | 335   




Forecasted 2000 Results





The Corporation
               announced in January 2000 that projected earnings for the year
               would be in the range of $2.80$3.00 per share. This
               expected decline from the 1999 managed business segment results
               is primarily due to the projected earnings decline in Credit
               Card.





|                                                                     |  | Earnings Per Share           
|-------------------------------------------------------------------- |  | -----------------------------
|1999
                 Managed Business Segment Results               |  | $3.46                        
|Growth
                 in core business units excluding Credit Card |  | 0.45
                 0.50  
|Decline
                 in Credit Card profitability                |  | (0.60
                 0.70)
|Run-rate
                 and market risk considerations             |  | (0.35
                 0.40)
|Projected 2000 Earnings                                              |  | $2.80
                 $3.00




The pretax
               return on outstandings in the credit card business is projected
               to decline from 2.5% in 1999 to approximately 1.0% in 2000. This
               reduction translates into a 6070 cent per share earnings
               decline in 2000. The Corporation is in the process of
               implementing changes in Credit Card that are anticipated to
               produce a return of between 1.50% and 1.75% for 2001, which is
               consistent with the current profitability of other market
               participants in this business.





Core growth in
               other businesses is expected to generate earnings improvement of
               4550 cents per share in 2000. However, additional risk
               factors, including the economy, higher interest rates and
               competition, could negatively affect projected 2000 earnings by
               up to 40 cents per share, as shown in the table
               above.





EARNINGS
             ANALYSIS





Summary of Financial Results





The Corporation
               s 1999 net income was $3.479 billion, or $2.95 per share,
               up from $3.108 billion, or $2.61 per share, in 1998, and
               compared with $2.960 billion, or $2.43 per share, in 1997. The
               following table summarizes the key financial lines and ratios
               for the years presented.





|(Dollars in millions, except per share
                 data) |  | 1999                       |   | 1998 |                            | 1997
|------------------------------------------------------------- |  | -------------------------- | - | ---- | -------------------------- | ----
|Net
                 interest incometax-equivalent basis     |  | $
                   9,142 |   |      | $ 
                  9,469 |     
|Provision for credit losses                                   |  | 1,249                      |   |      | 1,408                      |     
|Noninterest income                                            |  | 8,692                      |   |      | 8,071                      |     
|Noninterest expense                                           |  | 11,490                     |   |      | 11,545                     |     
|Net
                 income                                   |  | 3,479                      |   |      | 3,108                      |     
|Earnings per share                                            |  |                            |   |      |                            |     
|Basic                                                         |  | 2.97                       |   |      | 2.65                       |     
|Diluted                                                       |  | 2.95                       |   |      | 2.61                       |     
|Return
                 on assets                             |  | 1.36                       | % |      | 1.30                       | %   
|Return
                 on common equity                      |  | 17.1                       |   |      | 15.9                       |     
|Net
                 interest margin                          |  | 4.09                       |   |      | 4.52                       |     
|Efficiency ratio                                              |  | 64.4                       |   |      | 65.8                       |     




Basis
               of Presentation





Management
               s discussion and analysis may contain forward-looking
               statements that are provided to assist in the understanding of
               anticipated future financial performance. However, such
               performance involves risks and uncertainties that may cause
               actual results to differ materially from those expressed in
               forward-looking statements. See pages 3637 for a full
               discussion of such factors.





For funding and
               risk management purposes, the Corporation periodically
               securitizes loans, primarily in support of credit card
               activities. The accounting for securitizations complicates the
               understanding of underlying trends in net interest income, net
               interest margin and noninterest income, as well as the
               underlying growth rates of reported loans. For clarification,
               these trends are also reviewed on a managed basis,
               which adds data on securitized credit card loans to reported
               data on loans. Results on a managed basis, where presented,
               should be read in conjunction with reported results. See page 76
               for reconciliation of reported to managed results.





Net
               Interest Income





Net interest
               income includes fundamental spreads on earning assets as well as
               such items as loan fees, cash interest collections on problem
               loans, dividend income, interest reversals, and income or
               expense relating to derivatives used to manage interest rate
               risk. Net interest margin measures how efficiently the
               Corporation uses its earning assets and underlying
               capital.





In order to
               understand fundamental trends in net interest income, average
               earning assets and net interest margins, it is useful to analyze
               financial performance on a managed portfolio basis, which adds
               data on securitized loans to reported data on loans.





|(Dollars in millions)                                     |  | 1999                         |   | 1998 |                              | 1997
|--------------------------------------------------------- |  | ---------------------------- | - | ---- | ---------------------------- | ----
|Managed                                                   |  |                              |   |      |                              |     
|Net
                 interest incometax-equivalent basis |  | $
                   14,457  |   |      | $ 
                  13,828  |     
|Average
                 earning assets                   |  | 269,237                      |   |      | 248,621                      |     
|Net
                 interest margin                      |  | 5.37                         | % |      | 5.56                         | %   
|Reported                                                  |  |                              |   |      |                              |     
|Net
                 interest incometax-equivalent basis |  | $
                     9,142 |   |      | $ 
                    9,469 |     
|Average
                 earning assets                   |  | 223,539                      |   |      | 209,514                      |     
|Net
                 interest margin                      |  | 4.09                         | % |      | 4.52                         | %   




Managed net
               interest margin decreased 19 basis points to 5.37% in 1999, from
               5.56% in 1998. Lower margins on credit card loans were the most
               significant cause of the overall margin decline in 1999,
               reflecting customer attrition and lower late fees, plus modestly
               higher funding costs in 1999. Going forward, pricing on credit
               card loans will continue to compress credit card
               spreads.





On a reported
               basis, net interest margin was 4.09% in 1999, compared with
               4.52% in 1998 and 4.75% in 1997. The decrease in net interest
               margin was related to lower credit card spreads as well as a
               less favorable earning asset mix.





Managed net
               interest income increased 5% in 1999, compared with that of
               1998. This growth was primarily attributable to a $20.6 billion,
               or an 8%, increase in average earning assets.





|(In
                 millions)         |  | 1999                        |  | Percent |   | 1998 |                             | Percent |     | 1997 |  | Percent                    
|-------------------------------------- |  | --------------------------- |  | ------- | - | ---- | --------------------------- | ------- | --- | ---- |  | ---------------------------
|Average
                 managed loans |  |                             |  |         |   |      |                             |         |     |      |  |                            
|Credit
                 card           |  | $
                   68,980 |  | 32      | % |      | $ 
                  60,532 |         | 30  | %    |  | $ 
                  54,872
|Commercial                             |  | 90,182                      |  | 41      |   |      | 82,118                      |         | 41  |      |  | 76,636                     
|Other
                 consumer        |  | 59,440                      |  | 27      |   |      | 57,206                      |         | 29  |      |  | 56,410                     
|                                       |  |                             |  |         |   |      |                             |         |     |      |  |                            
|Total                                  |  | $218,602                    |  | 100     | % |      | $199,856                    |         | 100 | %    |  | $187,918                   
|                                       |  |                             |  |         |   |      |                             |         |     |      |  |                            




Average
               managed credit card loans in 1999 were up 14% from 1998 levels
               to $69.0 billion. Despite this year-over-year average growth,
               average outstandings were generally flat throughout 1999. The
               Corporation anticipates that average credit card outstandings
               will be flat to down 5% in 2000.





Average
               commercial loan volume increased 10%, or $8 billion, in 1999,
               reflecting underlying growth, as well as loan demand resulting
               from ongoing market liquidity conditions. Much of this growth
               has been concentrated in the large corporate and middle market
               segments.





Average consumer
               loans, excluding credit card loans, were up $2.2 billion, or 4%,
               from 1998. Growth in home equity loans was offset by run-off in
               residential mortgages and portfolio sales.





Managed net
               interest income for 1998 increased $878 million, or 7%, from
               1997, due primarily to a $13.2 billion increase in average
               earning assets. The managed net interest margin for 1998
               increased to 5.56% from 5.50% in 1997, reflecting growth in
               higher spread credit card loans, as well as deposit growth.
               Average commercial loans grew 7% in 1998, predominantly
               reflecting growth in the middle market segment. Average consumer
               loans were essentially flat in 1998 compared with
               1997.





Noninterest Income





In order to
               provide more meaningful trend analysis, credit card fee revenue
               and total noninterest income in the following table are shown on
               a managed basis. Credit card fee revenue excludes the net
               interest revenue associated with securitized credit card
               receivables. Managed noninterest income increased 7% in 1999,
               following a 16% increase in 1998.





|                                                       |  |                          |  |                          |  |                          |  | Percent
               
               Increase (Decrease)
|------------------------------------------------------ |  | ------------------------ |  | ------------------------ |  | ------------------------ |  | ----------------------------------------------------------
|
|Equity
                 securities gains               |  | $
                   415 |  | $ 
                  250 |  | $ 
                  334 |  | 66                                                        
|Trading
                 profits                       |  | 147                      |  | 141                      |  | 117                      |  | 4                                                         
|Investment securities gains                            |  | 94                       |  | 155                      |  | 101                      |  | (39                                                       
|                                                       |  |                          |  |                          |  |                          |  |                                                           
|Market-driven revenue                                  |  | 656                      |  | 546                      |  | 552                      |  | 20                                                        
|Credit
                 card revenue (1)               |  | 1,377                    |  | 1,424                    |  | 1,194                    |  | (3                                                        
|Fiduciary and investment management fees               |  | 793                      |  | 807                      |  | 746                      |  | (2                                                        
|Service
                 charges on deposits           |  | 1,283                    |  | 1,255                    |  | 1,219                    |  | 2                                                         
|Other
                 service charges and commissions |  | 1,502                    |  | 1,390                    |  | 1,172                    |  | 8                                                         
|                                                       |  |                          |  |                          |  |                          |  |                                                           
|Managed
                 fee-based revenue             |  | 4,955                    |  | 4,876                    |  | 4,331                    |  | 2                                                         
|Gains
                 from Retail Delivery Initiative |  |                         |  | 259                      |  |                         |  | N/M                                                       
|Gain on
                 Indiana divestitures          |  | 249                      |  |                         |  |                         |  | N/M                                                       
|Gain on
                 sale of Concord/EPS           |  | 111                      |  |                         |  |                         |  | N/M                                                       
|Other                                                  |  | 671                      |  | 538                      |  | 497                      |  | 25                                                        
|                                                       |  |                          |  |                          |  |                          |  |                                                           
|Managed
                 noninterest income            |  | $6,642                   |  | $6,219                   |  | $5,380                   |  | 7                                                         
|                                                       |  |                          |  |                          |  |                          |  |                                                           




|(1) | Excludes net credit card revenue due to securitizations
                 totaling $2.050 billion in 1999, $1.852 billion in 1998 and
                 $1.314 billion in 1997.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

N/M
               Not meaningful.





Market-Driven Revenue





Market-driven
               revenue increased 20% over year-ago levels. The mix of
               market-driven revenue changed from that of 1998, as improvements
               in both equity securities gains and trading profits were offset
               by the year-over-year decline in investment securities gains.
               While more sensitive to changes in market conditions than other
             noninterest income components, market-driven revenue remains a
               core component of the commercial business and an important
               contributor to overall earnings growth.





Equity
               securities gains totaled $415 million in 1999, up from $250
               million in 1998 and $334 million in 1997. Favorable equity
               markets in 1999 produced higher market valuations and an
               increase in transaction volume. Investment securities gains
               totaled $94 million in 1999, compared with $155 million in 1998
               and $101 million in 1997. Investment securities gains were lower
               in 1999 as a result of less favorable market conditions for
               certain debt instruments. The higher investment securities gains
               in 1998 and 1997 primarily resulted from more active management
               of the investment portfolio, with a focus on government and
               mortgage-backed securities.





Trading profits
               were $147 million in 1999, compared with $141 million in 1998
               and $117 million in 1997. More favorable results in derivatives
               in 1999 were offset by a decline in foreign exchange trading.
               Derivative trading results in 1998 were negatively affected by
               losses recognized in specific portfolio positions, as well as by
               a volatile interest rate environment. Foreign exchange trading
               benefited from the volatility in foreign currency markets
               experienced in 1998 and 1997.





Managed Fee-Based Revenue





Managed
               fee-based revenue grew 2% in 1999, following 13% growth in 1998.
               Adjusted for the impact of the reclassification of shareholder
               services revenue and writedowns included in credit card revenue
               described below, each major category of fee-based revenue posted
               increases in both years.





Credit card fee
               revenue in 1999 includes asset impairment writedowns of $99
               million for certain assets, including affinity programs and
               interest-only strips retained by the Corporation in
               securitization transactions. These writedowns were based on the
               continued earnings decline in the credit card business. Such
               assets continue to represent ongoing risk exposures. Changes in
               projected revenues, adverse market movements or customer payment
               rates could result in additional impairment charges in future
               periods. Excluding these writedowns, credit card fees rose 4% to
               $1.476 billion in 1999, reflecting higher levels of interchange
               and cardholder fees, partially offset by reduced gains on credit
               card securitizations. Growth in average credit card receivables
               in both 1999 and 1998 produced higher levels of account- and
               transaction-based fee revenue. Excluding the impact of the
               fourth quarter 1999 writeoffs, securitization-related gains
               totaled $54 million in 1999, $180 million in 1998 and $188
               million in 1997. Credit card receivables are expected to remain
               stable or decline slightly in 2000, which may result in reduced
               levels of fee-based revenue.





Fiduciary and
               investment management fees include revenue generated by
               traditional trust products and services, investment management
               activities and the shareholder services business. In December
               1998, the Corporation combined its shareholder services business
               with that of Boston EquiServe Limited Partnership and began
               recognizing its proportionate share of the partnerships
               net earnings in other noninterest income. Adjusted for this
               reclassification, fiduciary and investment management fees were
               up 11% for 1999. This increase reflects an increase in
               proprietary mutual funds, as well as general increases in the
               market value of trust assets under management.





Service charges
               on deposit accounts, which include deficient balance fees,
               increased 2% to $1.283 billion for 1999, following a 3% increase
               in 1998. Growth in cash management fees was a contributing
               factor, due in part to the extensive cross-selling of product
               offerings across an expanded geographic region. Effective
               cross-selling was supported by enhanced product features and
               functionality of the core treasury management services provided
               to customers on a national basis.





Other service
               charges and commissions in 1999 increased 8% from 1998 levels.
               Fees from asset-backed finance transactions grew in 1999 as the
               market for securitizations continued to be a source of liquidity
               for commercial customers. Loan syndication fees increased, as
               transaction flow continued to grow. Continued growth in other
               fee revenue from retail product areas, including home mortgage
               and investment management, also contributed to this excellent
               performance.





Included in
               other income in 1999 was $249 million of gains on the
               divestiture of banking centers required in connection with the
               Banc One/FCN Merger and a $111 million gain from an investment
               in Concord/EPS. Gains of $259 million from banking center sales,
               related to the Retail Delivery Initiative, were recorded in
               1998.





Other
               noninterest income increased $133 million, or 25%, from that
               recorded in 1998. Gains on sales of loans were $248 million for
               1999, $286 million for 1998 and $107 million for 1997. Earnings
               from investments accounted for under the equity method of
               accounting were $81 million higher in 1999 than in 1998. Charges
               of $100 million in 1999 and $102 million in 1998 were recorded
               for asset valuation adjustments associated with the Corporation
               s auto leasing portfolio. These charges were based on a
               periodic assessment of the automobile lease residual portfolio.
               While the Corporation has taken actions to mitigate such ongoing
               risk, the carrying value of the automobile lease residual
               portfolio remains subject to this ongoing market
               risk.





Noninterest Expense





Noninterest
               expense in 1999 was $11.490 billion, compared with $11.545
               billion in 1998. Noninterest expense for 1998 was 19% higher
               than in 1997. Excluding merger-related and restructuring
               charges, noninterest expense in 1999 was up 4% from 1998, and
               1998 expenses were 12% above 1997 levels. Business initiatives,
               particularly in Credit Card, contributed to the year-over-year
               increase in operating expense. Technology, systems and other
               reengineering projects also added to the overall expense
               growth.





|                                                      |  |                            |   |  |                            |   |  | Percent Increase
               
               (Decrease)
|----------------------------------------------------- |  | -------------------------- | - |  | -------------------------- | - |  | ----------------------------------------------------------
|
|Salaries and employee benefits                        |  |                            |   |  |                            |   |  |                                                           
|Salaries                                              |  | $
                   3,668 |   |  | $ 
                  3,770 |   |  | $3,551                                                    
|Employee
                 benefits                    |  | 603                        |   |  | 707                        |   |  | 673                                                       
|                                                      |  |                            |   |  |                            |   |  |                                                           
|Total
                 salaries and employee benefits |  | 4,271                      |   |  | 4,477                      |   |  | 4,224                                                     
|Net
                 occupancy and equipment expense  |  | 910                        |   |  | 845                        |   |  | 739                                                       
|Depreciation and amortization                         |  | 697                        |   |  | 680                        |   |  | 693                                                       
|Outside
                 service fees and processing  |  | 1,743                      |   |  | 1,349                      |   |  | 1,145                                                     
|Marketing and development                             |  | 1,188                      |   |  | 1,024                      |   |  | 837                                                       
|Communication and transportation                      |  | 829                        |   |  | 781                        |   |  | 711                                                       
|Merger-related and restructuring charges              |  | 554                        |   |  | 1,062                      |   |  | 337                                                       
|Other                                                 |  | 1,298                      |   |  | 1,327                      |   |  | 1,054                                                     
|                                                      |  |                            |   |  |                            |   |  |                                                           
|Noninterest expense                                   |  | $11,490                    |   |  | $11,545                    |   |  | $9,740                                                    
|                                                      |  |                            |   |  |                            |   |  |                                                           
|Full-time equivalent staff (December 31)              |  | 86,198                     |   |  | 91,310                     |   |  | 94,384                                                    
|                                                      |  |                            |   |  |                            |   |  |                                                           
|Efficiency ratio                                      |  | 64.4                       | % |  | 65.8                       | % |  | 59.7                                                      
|                                                      |  |                            |   |  |                            |   |  |                                                           




N/M = Not
               meaningful.





Salary and
               benefit costs were $4.271 billion in 1999, down 5% from $4.477
               billion in 1998, and were primarily the result of staff
               reductions. At December 31, 1999, full-time equivalent employees
               totaled 86,198, down 6% from 91,310 in 1998. Employee benefit
               costs decreased $104 million in 1999 compared with 1998, largely
               attributable to staff reductions and reduced pension costs, as
               well as to the integration of employee benefit programs. The
               1998 increases in salary and benefits costs of 6% and 5% from
               1997 levels reflected staffing increases to support growth in
               certain business activities as well as annual salary increases
               and higher performance-based initiatives in certain business
               units.





Occupancy and
               equipment expense was up $65 million, or 8%, from 1998 levels.
               The increase reflected growth in production facilities as well
               as higher equipment costs for certain business units. Occupancy
               and
             equipment expense in 1998 was up 14% from 1997 levels, reflecting
               the outsourcing of various property management services and the
               implementation and ongoing support of an expanded ATM delivery
               network, including the Rapid Cash retail banking initiative.
               This initiative was restructured at the end of 1998, resulting
               in a $65 million charge.





Outside service
               fees and processing expense increased 29% in 1999 and 18% in
               1998; these expenses included consulting and implementation
               costs incurred to support Year 2000 readiness, as well as other
               development, technology and reengineering initiatives in various
               businesses. Increased credit card transaction volume and account
               generation required higher levels of support and processing
               costs. Additionally, the outsourcing of certain ongoing business
               activities contributed to the year-over-year
               increases.





Year 2000
               readiness costs totaled $108 million in 1999 and $185 million in
               1998, and are included in various noninterest expense
               categories. See Year 2000 Readiness Disclosure on
               page 33.





Marketing and
               development expense increased 16% in 1999 and 22% in 1998.
               Credit card marketing efforts accounted for much of the increase
               in both periods. Additionally, in 1999 credit card account
               sourcing costs that were previously capitalized are now being
               expensed as incurred due to a change in business
               practices.





Other operating
               expense decreased $29 million in 1999, compared with the 1998
               figure. The increase in 1998 over 1997 levels reflected the cost
               to support growth in transaction-driven business activities and
               the higher level of technology-driven and business reengineering
               project initiatives.





Applicable Income Taxes





The following
               table shows the Corporations income before income taxes,
               as well as applicable income taxes and effective tax rate for
               each of the past three years.





|(Dollars in millions)                       |  | 1999   |   | 1998 |        | 1997
|------------------------------------------- |  | ------ | - | ---- | ------ | ----
|Income
                 before income taxes |  | $4,974 |   |      | $4,465 |     
|Applicable income taxes                     |  | 1,495  |   |      | 1,357  |     
|Effective tax rates                         |  | 30.1   | % |      | 30.4   | %   




Tax expense for
               all three years included benefits for tax-exempt income,
               tax-advantaged investments and general business tax credits
               offset by the effect of nondeductible expenses, including
               goodwill. A higher level of transaction activity in
               tax-advantaged products during 1999 and 1998 produced a lower
               effective rate than in 1997. More detail on income taxes can be
               found in Note 18, beginning on page 64.





RISK
             MANAGEMENT





The Corporation
               s various business activities generate liquidity, market
               and credit risks.





| | · | Liquidity risk is the possibility of being unable to
                 meet all current and future financial obligations in a timely
                 manner.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------




| | · | Market
                 risk is the possibility that changes in future market rates or
                 prices will make the Corporations positions less
                 valuable.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




| | · | Credit
                 risk is the possibility of loss from a customers failure
                 to perform according to the terms of a
                 transaction.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------




Compensation for
               assuming these risks is reflected in interest income, trading
               profits and fee income. In addition, these risks are factored
               into the allocation of capital to support various business
               activities, as discussed in the Capital Management
               section, beginning on page 33.





The
               Corporation is a party to transactions involving financial
               instruments that create risks that may or may not be reflected
               on a traditional balance sheet. These financial instruments can
               be subdivided into three categories:





| | · | Cash
                 financial instruments, which are generally characterized as
                 on-balance sheet transactions and include loans, bonds, stocks
                 and deposits.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




| | · | Credit-related financial instruments, which include
                 such instruments as commitments to extend credit and standby
                 letters of credit.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------




| | · | Derivative financial instruments, which include such
                 instruments as interest rate, foreign exchange, equity price
                 and commodity price contracts, including forwards, swaps and
                 options.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




The Corporation
               s risk management policies are intended to identify,
               monitor and limit exposure to liquidity, market and credit risks
               that arise from each of these financial instruments.





LIQUIDITY
             RISK
             MANAGEMENT





Liquidity is
               managed in order to preserve stable, reliable and cost-effective
               sources of cash to meet all current and future financial
               obligations in a timely manner. The Corporation considers strong
               capital ratios, credit quality and core earnings as essential to
               retaining high credit ratings and, consequently, cost-effective
               access to market liquidity. In addition, a portfolio of liquid
               assets, consisting of federal funds sold, deposit placements and
               selected highly marketable investment securities, is maintained
               to meet short-term demands on liquidity.





The Consolidated
               Statement of Cash Flows, on page 41, presents data on cash and
               cash equivalents provided and used in operating, investing and
               financing activities.





The Corporation
               s ability to attract wholesale funds on a regular basis
               and at a competitive cost is fostered by strong ratings from the
               major credit rating agencies. As of January 31, 2000, the
               Corporation and its principal banks had the following long- and
               short-term debt ratings.





Credit
               Ratings





|January 31, 2000                          |  | Short
                 
               
               Term Debt |  | Senior
               
               LongTerm Debt
|----------------------------------------- |  | ----------------------------------------------------------------- |  | ----------------------------------------------------
|
|The
                 Corporation (Parent) |  | A-1                                                               |  | P-1                                                 
|Principal Banks                           |  | A-1                                                               |  | P-1                                                 




Standard &
               Poors lowered the ratings of the Corporation and principal
               banks on January 11, 2000. No material impact on the ability to
               raise wholesale funding is anticipated for the Corporation or
               its principal banks.





The Treasury
               Department is responsible for identifying, measuring and
               monitoring the Corporations liquidity profile. The
               position is evaluated monthly by analyzing the composition of
               the liquid asset portfolio, performing various measures to
               determine the sources and stability of the wholesale purchased
               funds market, tracking the exposure to off-balance sheet draws
               on liquidity and monitoring the timing differences in short-term
               cash flow obligations.





Access to a
               variety of funding markets and customers in the retail and
               wholesale sectors is vital both to liquidity management and to
               cost minimization. A large retail customer deposit base is one
               of the significant strengths of the Corporations liquidity
               position. In addition, a diversified mix of short- and long-term
               funding sources from the wholesale markets is maintained through
               active participation in global capital markets and by
               securitizing and selling assets such as credit card
               receivables.





The following
               table shows the total funding source mix for the periods
               indicated.





Deposits and Other Purchased Funds





|December 31 (In millions)                                                                                                |  | 1999                        |  | 1998                        |  | 1997                        |  | 1996                        |  | 1995                       
|------------------------------------------------------------------------------------------------------------------------ |  | --------------------------- |  | --------------------------- |  | --------------------------- |  | --------------------------- |  | ---------------------------
|Domestic offices                                                                                                         |  |                             |  |                             |  |                             |  |                             |  |                            
|Demand                                                                                                                   |  | $
                   31,194 |  | $ 
                  39,854 |  | $ 
                  35,954 |  | $ 
                  33,479 |  | $ 
                  31,653
|Savings                                                                                                                  |  | 64,435                      |  | 62,645                      |  | 58,946                      |  | 56,359                      |  | 52,463                     
|Time                                                                                                                     |  |                             |  |                             |  |                             |  |                             |  |                            
|Under
                 $100,000                                                                                          |  | 22,825                      |  | 24,483                      |  | 28,815                      |  | 30,955                      |  | 31,184                     
|$100,000
                 and over                                                                                       |  | 14,052                      |  | 11,819                      |  | 11,329                      |  | 10,312                      |  | 10,753                     
|Foreign
                 offices                                                                                         |  | 29,772                      |  | 22,741                      |  | 18,682                      |  | 14,101                      |  | 19,290                     
|                                                                                                                         |  |                             |  |                             |  |                             |  |                             |  |                            
|Total
                 deposits                                                                                          |  | 162,278                     |  | 161,542                     |  | 153,726                     |  | 145,206                     |  | 145,343                    
|Federal
                  funds purchased and securities under
               
                    repurchase agreements |  | 18,720                      |  | 23,164                      |  | 20,346                      |  | 21,662                      |  | 24,906                     
|Commercial paper                                                                                                         |  | 3,184                       |  | 2,113                       |  | 1,507                       |  | 2,446                       |  | 941                        
|Other
                 short-term borrowings                                                                             |  | 18,027                      |  | 14,824                      |  | 11,299                      |  | 10,593                      |  | 12,781                     
|Long-term debt (1)                                                                                                       |  | 35,435                      |  | 22,298                      |  | 21,546                      |  | 15,363                      |  | 12,582                     
|                                                                                                                         |  |                             |  |                             |  |                             |  |                             |  |                            
|Total
                 other purchased funds                                                                             |  | 75,366                      |  | 62,399                      |  | 54,698                      |  | 50,064                      |  | 51,210                     
|                                                                                                                         |  |                             |  |                             |  |                             |  |                             |  |                            
|Total                                                                                                                    |  | $237,644                    |  | $223,941                    |  | $208,424                    |  | $195,270                    |  | $196,553                   
|                                                                                                                         |  |                             |  |                             |  |                             |  |                             |  |                            




(1)
               Includes trust preferred capital securities.





MARKET
             RISK
             MANAGEMENT





Overview





Market risk
               refers to potential losses arising from changes in interest
               rates, foreign exchange rates, equity prices and commodity
               prices, as well as the correlation among these factors and their
               volatility. The portfolio effect of engaging in diverse trading
               activities helps reduce the potential impact of market risk on
               earnings. Through its trading activities, the Corporation
               strives to take advantage of profit opportunities available in
               interest and exchange rate movements. In asset and liability
               management activities, policies are in place that are designed
               to closely manage structural interest rate and foreign exchange
               rate risk. Disclosures about the fair value of financial
               instruments, which reflect changes in market prices and rates,
               can be found in Note 21, beginning on page 68.





Trading Activities





The Corporation
               s trading activities are primarily customer-oriented. Cash
               instruments are sold to satisfy customers investment
               needs. Derivative contracts are initially entered into to meet
               the risk management needs of customers. In general, the
               Corporation then enters into offsetting positions to reduce
               market risk. In order to accommodate customers, an inventory of
               capital markets instruments is carried, and access to market
               liquidity is maintained by making bid-offer prices to other
               market makers. The Corporation may also take proprietary trading
               positions in various capital markets cash instruments and
               derivatives, and these positions are designed to profit from
               anticipated changes in market factors.





Many trading
               positions are kept open for brief periods of time, often less
               than one day. Other positions may be held for longer periods.
               Trading positions are valued at estimated fair value. Realized
               and unrealized gains and losses on these positions are included
               in noninterest income as trading profits.





The Corporation
               manages its market risk through a value-at-risk measurement and
               control system, through stress testing, and through dollar
               limits imposed on trading desks and individual traders. The Risk
               Management Committee of the Board of Directors approves the
               overall market risk that any line of business can assume. The
               primary oversight unit for market risk arising from trading and
               trading related activity is the Market Risk Policy
             and Review Department, which develops policy to monitor and limit
               market risk and oversees the Corporations process for
               managing risk. Value-at-risk is intended to measure the maximum
               fair value the Corporation could lose on a trading position,
               given a specified confidence level and time horizon.
               Value-at-risk limits and exposure are monitored on a daily basis
               for each significant trading portfolio. Stress testing is
               similar to value-at-risk except that the confidence level is
               geared to capture more extreme, less frequent market
               events.





The Corporation
               s value-at-risk calculation measures potential losses in
               market value using a 99% confidence level and a one-day time
               horizon. This equates to 2.33 standard deviations from the mean
               under a normal distribution. This means that, on average, daily
               losses are expected to exceed value-at-risk one out of every 100
               overnight trading days. Value-at-risk is calculated using
               various statistical models and techniques for cash and
               derivative positions, including options. Because of market
               relationships, the Corporation is able to recognize
               risk-reducing diversification benefits across certain trading
               portfolios. However, the reported value-at-risk remains somewhat
               overstated because not all offsets and correlations are fully
               considered in the calculation.





The following
               table shows average, high and low value-at-risk derived from the
               four quarter-ends of 1999 and 1998, along with value-at-risk
               figures for December 31, 1999, and December 31, 1998. The
               activities covered by the table include trading activities and
               other activities, including certain overseas balance sheet
               positions, that are managed principally as trading
               risk.





Value-At-Risk





|(In
                 millions)  |  | 1999
               
               Average |  | 1999
               
               High |  | 1999
               
               Low |  | Dec
                 31,
               
               1999 |   | 1998
               
               Average |     | 1998
               
               High |     | 1998
               
               Low |     | Dec
                 31,
               
               1998
|------------------------------- |  | ------------------------------------------- |  | ---------------------------------------- |  | --------------------------------------- |  | ------------------------------------------------------------ | - | ------------------------------------------- | --- | ---------------------------------------- | --- | --------------------------------------- | --- | ------------------------------------------------------------
|Risk
                 type      |  |                                             |  |                                          |  |                                         |  |                                                              |   |                                             |     |                                          |     |                                         |     |                                                             
|Interest
                 rate  |  | $21                                         |  | $28                                      |  | $14                                     |  | $14                                                          |   |                                             | $23 |                                          | $27 |                                         | $16 |                                                             
|Exchange
                 rate  |  | 1                                           |  | 2                                        |  |                                        |  |                                                             |   |                                             | 2   |                                          | 2   |                                         | 1   |                                                             
|Equity                          |  | 1                                           |  | 1                                        |  | 1                                       |  | 1                                                            |   |                                             | 2   |                                          | 3   |                                         | 1   |                                                             
|Commodity                       |  |                                            |  |                                         |  |                                        |  |                                                             |   |                                             |    |                                          | 1   |                                         |    |                                                             
|Diversification benefit         |  |                                             |  |                                          |  |                                         |  | (2                                                           | ) |                                             |     |                                          |     |                                         |     |                                                             
|                                |  |                                             |  |                                          |  |                                         |  |                                                              |   |                                             |     |                                          |     |                                         |     |                                                             
|Aggregate portfolio market risk |  |                                             |  |                                          |  |                                         |  | $13                                                          |   |                                             |     |                                          |     |                                         |     |                                                             
|                                |  |                                             |  |                                          |  |                                         |  |                                                              |   |                                             |     |                                          |     |                                         |     |                                                             




Interest rate
               risk was the predominant type of market risk incurred during
               1999. At December 31, 1999, before taking diversification
               benefits into account, approximately 91% of primary market risk
               exposures were related to interest rate risk. Exchange rate,
               equity and commodity risks accounted for 4%, 4% and 1%,
               respectively, of primary market risk exposures.





U.S. Treasury,
               corporate, asset-backed, municipal and mortgage-backed
               securities generated 88% of interest rate risk. Interest rate
               derivatives accounted for 11% of interest rate risk. The
               remaining 1% of interest rate risk was derived from money market
               and foreign exchange trading activities.





Within the
               category of exchange rate risk, 76% of the risk was generated by
               foreign exchange spot, forward and option trading. Of the
               exchange rate risk arising from these activities, 23% related to
               major currency exposures and 77% to minor currencies. The
               remaining exchange rate risk was largely from interest rate and
               equity derivatives trading.





Equity cash
               instruments trading generated 54% of equity price risk, and
               equity derivatives trading generated the remaining 46% of equity
               price risk.





At December 31,
               1999, aggregate portfolio market risk exposures were 54% lower
               than at year-end 1998. The majority of this decline was due to
               decreased market risk in various trading books.





Structural Interest Rate Risk Management





Interest rate
               risk exposure in the Corporations non-trading activities
               (i.e., asset liability management (ALM) position) is
               created from repricing, option and basis risks that exist in on-
               and off-balance sheet positions. Repricing risk occurs when
               interest rate-sensitive financial asset or liability positions
               reprice at different times as interest rates change. Basis risk
               arises from a shift in the relationship of the rates on
               different financial instruments. Option risk is due to
               embedded options often present in customer products
               including interest rate, prepayment and early withdrawal
               options; administered interest rate products; deposit products
               with no contractual maturity structure; and certain off-balance
               sheet sensitivities. These embedded option positions are complex
               risk positions that are difficult to offset completely and,
               thus, represent the primary risk of loss to the
               Corporation.





The Corporation
               s policies strictly limit which business units are
               permitted to assume interest rate risk. The level of interest
               rate risk that can be taken is closely monitored and managed by
               a comprehensive risk control process. The Market and Investment
               Risk Management Committee, consisting of senior executives of
               the finance group, credit and market risk oversight units, and
               line of business units, are responsible for establishing the
               market risk parameters acceptable for the Corporations ALM
               position. Through these parameters the Committee balances the
               return potential of the ALM position against the desire to limit
               volatility in earnings and/or economic value. The ALM position
               is measured and monitored using sophisticated and detailed risk
               management tools, including earnings simulation modeling and
               economic value of equity sensitivity analysis, to capture both
               near-term and longer-term interest rate risk exposures. The
               Committee establishes the risk measures, risk limits, policy
               guidelines and the internal control mechanisms (collectively
               referred to as the Interest Rate Risk Policy) for managing the
               overall ALM exposure. The Interest Rate Risk Policy is reviewed
               and approved by a committee of the Board of
               Directors.





Earnings
               simulation analysis, or earnings-at-risk, measures the
               sensitivity of pretax earnings to various interest rate
               movements. The base-case scenario is established using the
               forward yield curve. The comparative scenarios assume an
               immediate parallel shock of the forward curve in increments of
               ±100 basis point rate movements. Additional scenarios are
               analyzed, including more gradual rising or falling rate changes
               and non-parallel rate shifts. The interest rate scenarios are
               used for analytical purposes and do not necessarily represent
               managements view of future market movements. Estimated
               earnings for each scenario are calculated over a forward-looking
               12-month horizon (e.g., projected 1999 earnings for the December
               1998 figures and projected 2000 earnings for the December 1999
               figures).





The Corporation
               s earnings sensitivity profile as of year-end 1999 and
               1998 is stated below:





|Pretax earnings change |  | Immediate Change
               
               in Rates
|---------------------- |  | --------------------------------------------------------
|
|December 31, 1999      |  | 3.7%                                                    
|                       |  |                                                         
|December 31, 1998      |  | 1.5%                                                    
|                       |  |                                                         




Assumptions are
               made in modeling the sensitivity of earnings to interest rate
               changes. For residential mortgage whole loans, mortgage-backed
               securities, home equity loans and collateralized mortgage
               obligations, the earnings simulation model captures the expected
               prepayment behavior under changing interest rate environments.
               Additionally, the model measures the impact of interest rate
               caps and floors on adjustable-rate products. Assumptions
               regarding the interest rate or balance behavior of indeterminate
               maturity products (savings, money market, NOW and demand
               deposits) reflect managements best estimate of expected
               future behavior. Sensitivity of service fee income to market
               interest rate levels, such as those related to cash management
               products, is included as well. The earnings sensitivity profile
               does not reflect potential differences in the timing of income
               recognition on transactions that were designed to have an
               offsetting economic effect. For example, volatility of earnings
               in interim periods may result as the present value of net
               interest revenues reflected in an interest-only strip is
             recorded upon a credit card securitization; the interest-only
               strip may be subsequently subject to the accounting recognition
               of impairment due to adverse changes in market interest and
               payment rates while the income or expense on offsetting asset
               and liability positions are recorded on an accrual basis. The
               change in percentage sensitivity between 1998 and 1999 is
               primarily due to the difference in year-over-year projected
               earnings. The Corporations economic risk position
               (discussed later in this section) has not changed significantly
               year-over-year.





The Corporation
               has risk exposure at time periods beyond the 12 months captured
               in earnings sensitivity analysis. Management uses an economic
               value of equity sensitivity technique to capture the risk in
               both short and long-term positions. This analysis involves
               calculating future cash flows over the full life of all current
               assets, liabilities and off balance-sheet positions under
               different rate scenarios. The discounted present value of all
               cash flows represents the Corporations economic value of
               equity. The sensitivity of this value to shifts in the yield
               curve allows management to measure longer-term repricing and
               option risk in the portfolio. Interest rate risk in trading
               activities and other activities, including certain overseas
               balance sheet positions, is managed principally as trading
               risk.





Access to the
               derivatives market is an important element in maintaining the
               Corporations desired interest rate risk position. In
               general, the assets and liabilities generated through ordinary
               business activities do not naturally create offsetting positions
               with respect to repricing, basis or maturity characteristics.
               Using off-balance sheet instruments, principally plain vanilla
               interest rate swaps (ALM swaps), the interest rate sensitivity
               of specific on-balance sheet transactions, as well as pools of
               assets or liabilities, is adjusted to maintain the desired
               interest rate risk profile. At December 31, 1999, the notional
               value of ALM interest rate swaps totaled $19.7 billion,
               including $17.5 billion against specific transactions and $2.2
               billion against specific pools of assets or
               liabilities.





Asset
               and Liability Management DerivativesNotional
               Principal





|December 31, 1999
               
               (In millions) |  | Receive Fixed
               
               Pay Floating |  | Pay Fixed
               
               Receive Floating |  | Basis Swaps              |  | Total
               
               Swaps
|-------------------------------------------------------------- |  | --------------------------------------------------------- |  | --------------------------------------------------------- |  | ------------------------ |  | ------------------------------------------
|
|Swaps
                 associated with:                        |  |                                                           |  |                                                           |  |                          |  |                                           
|Loans                                                          |  | $ 
                                                      |  | $680                                                      |  | $ 
                  248 |  | $1,427                                    
|Investment securities                                          |  |                                                          |  |                                                          |  |                         |  | 121                                       
|Deposits                                                       |  | 666                                                       |  |                                                          |  |                         |  |                                          
|Funds
                 borrowed (including long-term debt).    |  | 11,138                                                    |  |                                                          |  | 5,287                    |  |                                          
|                                                               |  |                                                           |  |                                                           |  |                          |  |                                           
|Total                                                          |  | $11,804                                                   |  | $680                                                      |  | $5,535                   |  | $1,548                                    
|                                                               |  |                                                           |  |                                                           |  |                          |  |                                           
|Other
                 ALM Contracts (1)                       |  |                                                           |  |                                                           |  |                          |  |                                           
|                                                               |  |                                                           |  |                                                           |  |                          |  |                                           




|(1) | Primarily reflects the use of interest rate futures
                 contracts to hedge investment securities.
|--- | --------------------------------------------------------------------------------------------------------------




Swaps used to
               adjust the interest rate sensitivity of specific transactions
               will not need to be replaced at maturity, since the
               corresponding asset or liability will mature along with the
               swap. However, swaps against the asset and liability pools will
               have an impact on the overall risk position as they mature and
               may need to be reissued to maintain the same interest rate risk
               profile. These swaps could create modest earnings sensitivity to
               changes in interest rates.





The notional
               amounts, expected maturity, and weighted-average pay and receive
               rates for the ALM swap position at December 31, 1999, are
               summarized in the following table. For generic swaps, the
               maturities are contractual. In the table, the variable interest
               rateswhich generally are the prime rate, federal funds
               rate or the one-month, three-month and six-month London
               interbank offered rates (LIBOR) in effect on the
               date of repricingare assumed to remain constant. However,
               interest rates will change and consequently will affect the
               related weighted-average information presented in the
               table.





Asset
               and Liability Management SwapsMaturities and
               Rates





|December 31, 1999
               
               (Dollars in millions) |  | 2000                       |   | 2001 |                         | 2002 |  | 2003                     |   | 2004 |                        | Thereafter |  | Total                    
|---------------------------------------------------------------------- |  | -------------------------- | - | ---- | ----------------------- | ---- |  | ------------------------ | - | ---- | ---------------------- | ---------- |  | -------------------------
|Receive
                 fixed/pay floating swaps                      |  |                            |   |      |                         |      |  |                          |   |      |                        |            |  |                          
|Notional
                 amount                                       |  | $10,159                    |   |      | $525                    |      |  | $ 
                     |   |      | $ 
                   |            |  | $ 
                     
|Weighted
                 average                                      |  |                            |   |      |                         |      |  |                          |   |      |                        |            |  |                          
|Receive
                 rate                                          |  | 5.95                       | % |      | 5.98                    | %    |  |                         | % |      |                       | %          |  |                         
|Pay
                 rate                                              |  | 6.14                       |   |      | 6.18                    |      |  |                         |   |      |                       |            |  |                         
|Pay
                 fixed/receive floating swaps                      |  |                            |   |      |                         |      |  |                          |   |      |                        |            |  |                          
|Notional
                 amount                                       |  | $ 
                  1,032 |   |      | $ 
                  43 |      |  | $1,933                   |   |      | $664                   |            |  | $2,726                   
|Weighted
                 average                                      |  |                            |   |      |                         |      |  |                          |   |      |                        |            |  |                          
|Receive
                 rate                                          |  | 6.22                       | % |      | 6.17                    | %    |  | 6.18                     | % |      | 6.27                   | %          |  | 6.20                     
|Pay
                 rate                                              |  | 6.25                       |   |      | 7.24                    |      |  | 6.74                     |   |      | 6.75                   |            |  | 6.73                     
|Basis
                 swaps                                           |  |                            |   |      |                         |      |  |                          |   |      |                        |            |  |                          
|Notional
                 amount                                       |  | $ 
                    100 |   |      | $ 
                  50 |      |  | $ 
                     |   |      | $ 
                   |            |  | $ 
                    10
|                                                                       |  |                            |   |      |                         |      |  |                          |   |      |                        |            |  |                          
|Total
                 notional amount                                 |  | $11,291                    |   |      | $618                    |      |  | $1,933                   |   |      | $664                   |            |  | $2,736                   
|                                                                       |  |                            |   |      |                         |      |  |                          |   |      |                        |            |  |                          




Foreign Exchange Risk Management





Whenever
               possible, foreign currency-denominated assets are funded with
               liability instruments denominated in the same currency. If a
               liability denominated in the same currency is not immediately
               available or desired, a forward foreign exchange or
               cross-currency swap contract is used to fully hedge the risk due
               to cross-currency funding.





To minimize the
               earnings and capital impact of translation gains or losses
               measured on an after-tax basis, the Corporation uses forward
               foreign exchange contracts to hedge the exposure created by
               investments in overseas branches and subsidiaries.





CREDIT
             RISK
             MANAGEMENT





The Corporation
               has developed policies and procedures to manage the level and
               composition of risk in its credit portfolio. The objective of
               this credit risk management process is to quantify and manage
               credit risk on a portfolio basis as well as to reduce the risk
               of a loss resulting from a customers failure to perform
               according to the terms of a transaction.





Customer
               transactions create credit exposure that is reported both on and
               off the balance sheet. On-balance sheet credit exposure includes
               such items as loans. Off-balance sheet credit exposure includes
               unfunded credit commitments and other credit-related financial
               instruments. Credit exposures resulting from derivative
               financial instruments are reported both on and off the balance
               sheet; see pages 3132 for more details.





Selected Statistical Information





|(Dollars in millions)                                            |  | 1999     |   | 1998 |          | 1997 |  | 1996     |   | 1995
|---------------------------------------------------------------- |  | -------- | - | ---- | -------- | ---- |  | -------- | - | ----
|At
                 year-end                                    
|Loans
                 outstanding                               |  | $163,877 |   |      | $155,398 |      |  | $159,579 |   |     
|Nonperforming loans                                              |  | 1,053    |   |      | 729      |      |  | 609      |   |     
|Other,
                 including other real estate owned        |  | 106      |   |      | 90       |      |  | 61       |   |     
|Nonperforming assets                                             |  | 1,159    |   |      | 819      |      |  | 670      |   |     
|Allowance for credit losses                                      |  | 2,285    |   |      | 2,271    |      |  | 2,817    |   |     
|                                                                 | 
|Nonperforming assets/related assets                              |  | 0.71     | % |      | 0.53     | %    |  | 0.42     | % |     
|Allowance for credit losses/loans outstanding                    |  | 1.39     |   |      | 1.46     |      |  | 1.77     |   |     
|Allowance for credit losses/nonperforming
                 loans |  | 217      |   |      | 312      |      |  | 463      |   |     
|For the
                 year                                    |  |          |   |      |          |      |  |          |   |     
|Average
                 loans                                   |  | $156,855 |   |      | $154,952 |      |  | $155,926 |   |     
|Net
                 charge-offs                                 |  | 1,206    |   |      | 1,498    |      |  | 1,887    |   |     
|Net
                 charge-offs/average loans                   |  | 0.77     | % |      | 0.97     | %    |  | 1.21     | % |     




For analytical
               purposes, the Corporations portfolio is divided into
               commercial, consumer and credit card segments.





Loan
               Composition





|December 31 (In millions)         |  | 1999                        |  | 1998                        |  | 1997                        |  | 1996                        |  | 1995                       
|--------------------------------- |  | --------------------------- |  | --------------------------- |  | --------------------------- |  | --------------------------- |  | ---------------------------
|Commercial                        |  |                             |  |                             |  |                             |  |                             |  |                            
|Domestic                          |  |                             |  |                             |  |                             |  |                             |  |                            
|Commercial                        |  | $
                   55,661 |  | $ 
                  53,362 |  | $ 
                  48,458 |  | $ 
                  44,791 |  | $ 
                  40,587
|Real
                 estate      |  |                             |  |                             |  |                             |  |                             |  |                            
|Construction                      |  | 5,836                       |  | 5,108                       |  | 4,639                       |  | 4,387                       |  | 3,820                      
|Other                             |  | 18,817                      |  | 17,787                      |  | 16,545                      |  | 16,016                      |  | 15,106                     
|Lease
                 financing  |  | 8,971                       |  | 6,236                       |  | 4,537                       |  | 4,258                       |  | 3,335                      
|Foreign                           |  | 7,067                       |  | 5,945                       |  | 5,127                       |  | 4,160                       |  | 3,984                      
|                                  |  |                             |  |                             |  |                             |  |                             |  |                            
|Total
                 commercial |  | 96,352                      |  | 88,438                      |  | 79,306                      |  | 73,612                      |  | 66,832                     
|Consumer                          |  |                             |  |                             |  |                             |  |                             |  |                            
|Residential real estate (1)       |  | 32,313                      |  | 25,804                      |  | 28,088                      |  | 26,941                      |  | 24,049                     
|Automotive (2)                    |  | 23,567                      |  | 20,634                      |  | 17,998                      |  | 17,293                      |  | 15,946                     
|Other                             |  | 7,608                       |  | 11,488                      |  | 11,522                      |  | 10,795                      |  | 10,126                     
|                                  |  |                             |  |                             |  |                             |  |                             |  |                            
|Total
                 consumer   |  | 63,488                      |  | 57,926                      |  | 57,608                      |  | 55,029                      |  | 50,121                     
|Credit
                 card (3)  |  | 4,037                       |  | 9,034                       |  | 22,665                      |  | 24,855                      |  | 21,525                     
|                                  |  |                             |  |                             |  |                             |  |                             |  |                            
|Total                             |  | $163,877                    |  | $155,398                    |  | $159,579                    |  | $153,496                    |  | $138,478                   
|                                  |  |                             |  |                             |  |                             |  |                             |  |                            




|(1) | Includes first mortgages and home equity
                 receivables.
|--- | ----------------------------------------------------------------------

|(2) | Includes auto lease receivables.
|--- | --------------------------------

|(3) | During
                 1998, the Corporations certificated retained interest in
                 credit card securitizations was reclassified to investment
                 securitiesavailable for sale. At December 31, 1999, and
                 December 31, 1998, the certificated retained interest totaled
                 $19.7 billion and $16.7 billion, respectively.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




Nonperforming Assets





At December 31,
               1999, nonperforming assets totaled $1.159 billion, compared with
               $819 million at year-end 1998 and $670 million at year-end 1997.
               Of this increase, $329 million, or 97% occurred in the first
               quarter of 1999 and is attributable to portfolio deterioration
               in the consumer finance/mortgage, oil- and gas-related and
               healthcare industry segments within the commercial portfolio.
               Since the first quarter of 1999, nonperforming assets increased
               by only $11 million. Successful problem loan management and a
               generally favorable market
             during most of 1999 contributed to the stability of nonperforming
               assets since the first quarter. Nonperforming assets at December
               31, 1999, included $1.053 billion of nonperforming loans and
               $106 million of other non-performing assets, including other
               real estate owned.





Nonaccrual loans
               at year-end 1999 included $87 million of foreign loans, compared
               with $41 million of foreign loans at year-end 1998.





The following
               table shows a breakout of nonperforming assets for the past five
               years.





|December 31 (Dollars in millions)                         |  | 1999   |   | 1998 |      | 1997 |  | 1996 |   | 1995
|--------------------------------------------------------- |  | ------ | - | ---- | ---- | ---- |  | ---- | - | ----
|Nonaccrual loans                                          |  | $1,053 |   |      | $729 |      |  | $608 |   |     
|Accrual
                 renegotiated loans               |  |       |   |      |     |      |  | 1    |   |     
|                                                          |  |        |   |      |      |      |  |      |   |     
|Total
                 nonperforming loans (1)            |  | 1,053  |   |      | 729  |      |  | 609  |   |     
|Other,
                 including other real estate owned |  | 106    |   |      | 90   |      |  | 61   |   |     
|                                                          |  |        |   |      |      |      |  |      |   |     
|Total
                 nonperforming assets               |  | $1,159 |   |      | $819 |      |  | $670 |   |     
|                                                          |  |        |   |      |      |      |  |      |   |     
|Nonperforming assets/related assets                       |  | 0.71   | % |      | 0.53 | %    |  | 0.42 | % |     
|                                                          |  |        |   |      |      |      |  |      |   |     




|(1) | The
                 amount of interest on nonperforming loans that would have been
                 recorded in 1999 totaled $107 million. Of this amount, $43
                 million was actually recorded in 1999.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




Charge-offs





Managed net
               charge-offs increased 16.2% during 1999 to $4.654 billion.
               Portfolio growth, higher commercial charge-offs and charges
               related to the early adoption of certain new FFIEC consumer
               charge-off guidelines contributed to the increase. The managed
               net charge-off rate increased to 2.13% in 1999 versus 2.00% in
               1998. Excluding the FFIEC-related charges, the net charge-off
               rates would have been flat.





The following
               table shows a breakout of managed net charge-offs by portfolio
               segment for the past three years.





Charge-off Rates


|(Dollars in millions)               |  | 1999                     |  | 1998                        |  | 1997
|----------------------------------- |  | ------------------------ |  | --------------------------- |  | ----
|
|Commercial                          |  | $
                   306 |  | $
                   90,182 |  | 0.34
|Consumer (1)                        |  | 558                      |  | 59,440                      |  | 0.94
|Credit
                 card (1)(2) |  | 3,790                    |  | 68,980                      |  | 5.49
|                                    |  |                          |  |                             |  |     
|Total
                 (1)(2)       |  | $4,654                   |  | $218,602                    |  | 2.13
|                                    |  |                          |  |                             |  |     




|(1) | Includes $143 million of consumer charge-offs and $183
                 million of securitized charge-offs taken in the fourth quarter
                 of 1999 related to the early adoption of certain of the FFIEC
                 s new consumer charge-off guidelines.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Reported on a managed basis.
|--- | ----------------------------




Consumer Risk Management





Consumer risk
               management uses advanced risk assessment tools across each of
               the consumer lines of business, including credit cards, loans
               secured by real estate, automobile loans and leases, and other
               unsecured loans. With these tools, product and price offerings
               are targeted to best match the consumer risk
               profile.





Management
               continues to proactively manage the risk/reward relationship of
               each consumer loan portfolio segment, such that profitability
               targets and required rates of return on investment are
               achieved.





Consumer and Credit Card Loans





Consumer loans
               consist of credit card receivables as well as loans secured by
               residential real estate, automobile financing, and other forms
               of secured and unsecured consumer installment credit. Excluding
               securitized receivables, the consumer and credit card loan
               portfolio increased during the year to $67.5 billion at year-end
               1999. Including securitized credit card receivables, the
               consumer portfolio increased $4.9 billion, or 4%, to
             
             $132.8 billion at December 31, 1999.





|December 31 (In millions)        |  | 1999                         |  | 1998                         |  | 1997                        |  | 1996                        |  | 1995   
|-------------------------------- |  | ---------------------------- |  | ---------------------------- |  | --------------------------- |  | --------------------------- |  | -------
|Credit
                 card (1) |  | $
                     4,037 |  | $ 
                    9,034 |  | $ 
                  22,665 |  | $ 
                  24,855 |  | $21,525
|Residential real estate (2)      |  | 32,313                       |  | 25,804                       |  | 28,088                      |  | 26,941                      |  | 24,049 
|Automotive (3)                   |  | 23,567                       |  | 20,634                       |  | 17,998                      |  | 17,293                      |  | 15,946 
|Other                            |  | 7,608                        |  | 11,488                       |  | 11,522                      |  | 10,795                      |  | 10,126 
|                                 |  |                              |  |                              |  |                             |  |                             |  |        
|Total
                 owned     |  | 67,525                       |  | 66,960                       |  | 80,273                      |  | 79,884                      |  | 71,646 
|Securitized credit card          |  | 65,319                       |  | 60,993                       |  | 37,414                      |  | 29,303                      |  | 25,179 
|                                 |  |                              |  |                              |  |                             |  |                             |  |        
|Total
                 managed   |  | $132,844                     |  | $127,953                     |  | $117,687                    |  | $109,187                    |  | $96,825
|                                 |  |                              |  |                              |  |                             |  |                             |  |        







|(1) | During
                 1998, the Corporations certificated retained interest in
                 credit card securitizations was reclassified to investment
                 securitiesavailable for sale. At December 31, 1999, and
                 December 31, 1998, the certificated retained interest totaled
                 $19.7 billion and $16.7 billion, respectively.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(2) | Includes first mortgages and home equity
                 loans.
|--- | ----------------------------------------------------------------




|(3) | Includes auto lease receivables.
|--- | --------------------------------




Credit quality
               within the Corporations credit card, real estate,
               automotive and other secured and unsecured loan portfolios
               remains stable. The consumer economy continues to show
               extraordinary strength as the current economic expansion
               continues its record run. High consumer confidence has been
               driven by real wage growth, low unemployment and favorable
               financial market performance. If, as anticipated, interest rates
               move higher in 2000, consumer spending and economic growth could
               moderate. While current debt service burdens are manageable,
               successive sustained increases in interest rates will put
               pressure on consumer segments that continue to carry
               historically large levels of debt. Consumer bankruptcies, while
               down from their peak levels experienced in 1998, remain at
               historically high thresholds.





Managed Credit Card Receivables





Managed credit
               card receivables (i.e., those held in the portfolio and those
               sold to investors through securitization) were $69.4 billion at
               December 31, 1999, down slightly from year-end 1998. Average
               managed credit card receivables were $69.0 billion for 1999, up
               14% from the 1998 figure. The Corporation purchased the credit
               card operations of Chevy Chase Bank, FSB, including $4.8 billion
               of managed credit card loans, on September 30, 1998.





|(Dollars in millions)                                              |  | 1999                       |   | 1998 |                            | 1997
|------------------------------------------------------------------ |  | -------------------------- | - | ---- | -------------------------- | ----
|Average
                 balances                                  |  |                            |   |      |                            |     
|Credit
                 card loans                                 |  | $
                   7,233 |   |      | $15,628                    |     
|Securitized credit card receivables                                |  | 61,747                     |   |      | 44,904                     |     
|                                                                   |  |                            |   |      |                            |     
|Total
                 average credit card receivables             |  | $68,980                    |   |      | $60,532                    |     
|                                                                   |  |                            |   |      |                            |     
|Total
                 net charge-offs (including securitizations) |  | $
                   3,790 |   |      | $ 
                  3,369 |     
|                                                                   |  |                            |   |      |                            |     
|Net
                 charge-offs/average total receivables (1)     |  | 5.49                       | % |      | 5.57                       | %   
|Credit
                 card delinquency rate at period-end        |  |                            |   |      |                            |     
|30 or
                 more days                                   |  | 4.57                       | % |      | 4.47                       | %   
|90 or
                 more days                                   |  | 2.13                       | % |      | 1.98                       | %   




|(1) | Ratios
                 include $183 million of securitized charge-offs taken in the
                 fourth quarter of 1999, related to the early adoption of
                 certain of the FFIECs new consumer charge-off
                 guidelines.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




The managed
               credit card charge-off rate of 5.49% in 1999 includes the effect
               of $183 million of securitized charge-offs related to the early
               adoption of certain new FFIEC consumer charge-off guidelines.
               The 1999 rate also includes the effect of charge-off policy
               conformance changes made in the fourth quarter of 1998. Without
               conforming such practices, and excluding the impact of the $183
               million of securitized charge-offs, the 1999 charge-off rate
               would have been 5.36%, compared with 5.74% in 1998. In addition,
               30- and 90-day delinquency rates at year-end 1999 increased from
               those of a year ago. While overall credit quality is projected
               to remain reasonably stable in 2000, reported net charge-off
               rates are anticipated to be on average 50 basis points higher in
               2000 than those experienced in 1999, reflecting in part the
               impact of the adoption of the FFIEC charge-off guidelines and
               the seasoning of the portfolio.





Other
               Consumer Loans





Other consumer
               loans, primarily loans secured by real estate as well as auto
               loans and leases, continued to exhibit stable credit quality.
               The composition of the consumer loan portfolio provides broad
               diversification of risk from both a product and geographic
               perspective. Centralized underwriting and sophisticated risk
               assessment tools and collection practices contributed to this
               sound credit performance. Credit quality is anticipated to be
               stable in 2000, with net charge-off rates in line with the
               averages experienced over the past three years, excluding the
               one-time $143 million impact related to adoption of the FFIEC
               guidelines.





|(Dollars in millions)                                 |  | 1999                       |   | 1998 |                            | 1997
|----------------------------------------------------- |  | -------------------------- | - | ---- | -------------------------- | ----
|Average
                 balances                     |  | $59,440                    |   |      | $57,206                    |     
|                                                      |  |                            |   |      |                            |     
|Total
                 net charge-offs                |  | $
                     558 |   |      | $ 
                    413 |     
|                                                      |  |                            |   |      |                            |     
|Net
                 charge-offs/average balances (1) |  | 0.94                       | % |      | 0.72                       | %   
|                                                      |  |                            |   |      |                            |     




|(1) | Ratios
                 include $143 million of consumer charge-offs taken in the
                 fourth quarter of 1999, related to the early adoption of
                 certain of the FFIECs new consumer charge-off
                 guidelines. Excluding these charge-offs, the 1999 rate was
                 0.70%.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




The net
               charge-off rate for non-credit card consumer loans in 1999 was
               0.94%. The increase from prior periods is due to the $143
               million of consumer charge-offs taken in the fourth quarter of
               1999, related to early adoption of the FFIECs new consumer
               credit guidelines. The consumer charge-off rate, excluding these
               charge-offs, would have been 0.70%. This was down two basis
               points from the 1998 ratio, reflecting consistent performance on
               a vintage basis.





As growth in
               consumer credit slows, and as existing loans age into their peak
               loss experience lifecycle, it is anticipated that reported net
               charge-off rates will increase in future quarters. Adoption of
               more conservative charge-off recognition and loan re-age
               policies also will contribute to higher credit losses in
               2000.





Commercial Risk Management





The commercial
               risk portfolio includes all domestic and foreign commercial
               credit exposure. Credit exposure includes the credit risks
               associated with both on- and off-balance sheet financial
               instruments.





In the
               commercial portfolio, borrowers/transactions are assigned
               specific risk ratings based upon an established underwriting and
               approval process. Risk ratings are reviewed periodically and
               revised if needed to reflect the borrowers/transactions current
               risk profile. The lower categories of credit risk are equivalent
               to the four bank regulatory classifications: Special Mention,
               Substandard, Doubtful and Loss.





Commercial loans
               increased 9%, from $88.4 billion at December 31, 1998, to $96.4
               billion at December 31, 1999, primarily driven by merger and
               acquisition financing in the large corporate and middle market
               segments. Nonperforming commercial assets increased $340
               million, to $1.159 billion at year-end 1999, from $819 million
               at December 31, 1998, primarily due to portfolio deterioration
               in the first quarter of 1999 in the consumer finance/mortgage,
               oil and gas-related and healthcare industry segments. Commercial
               net charge-offs were $306 million, or 0.34% of average loans, in
               1999, compared with $222 million, or 0.27%, in 1998. For
             2000, net charge-offs are expected to increase given the outlook
               for managed portfolio growth, higher interest rates and greater
               market volatility.





Commercial Real Estate Segment





Commercial real
               estate is the largest product category in the commercial
               portfolio and consists primarily of loans secured by real
               estate, as well as certain loans that are real estate-related. A
               loan is categorized as real estate-related when 80% or more of
               the borrowers revenues are derived from real estate
               activities and the loan is not collateralized by cash or
               marketable securities. This segment is geographically
               diversified primarily in the states in which the Corporation
               operates.





At December 31,
               1999, commercial real estate loans totaled $24.7 billion, or 26%
               of commercial loans, compared with $22.9 billion, or 26% of
               commercial loans, at December 31, 1998. During 1999, net
               charge-offs in the commercial real estate portfolio segment were
               $1 million, compared with $2 million in 1998. Non-performing
               commercial real estate assets, including other real estate
               owned, totaled $413 million, or 1.7% of related assets, at
               December 31, 1999, compared with $337 million, or 1.5% of
               related assets, at December 31, 1998.





Industry Concentrations





The Commercial
               portfolio is diversified. Within the Commercial portfolio,
               wholesale trade, the largest segment with its $5.674 billion of
               outstandings, represents 5.9% of total loans. Only four other
               segmentsoil and gas, industrial materials, metals and
               products, and consumer staplesexceeded 3.3% of total
               commercial loans.





Industry Concentration





|December 31 (Dollars in millions)    |  | 1999   |  | Percent
|------------------------------------ |  | ------ |  | -------
|Wholesale trade                      |  | $5,674 |  | 5.9    
|Oil and
                 gas         |  | 4,444  |  | 4.6    
|Industrial materials                 |  | 3,806  |  | 4.0    
|Metals
                 and products |  | 3,486  |  | 3.6    
|Consumer staples                     |  | 3,177  |  | 3.3    




Allowance for Credit Losses





The allowance
               for credit losses is maintained at a level that in management
               s judgment is adequate to provide for estimated probable
               credit losses inherent in various on- and off-balance sheet
               financial instruments. The allowance is a general reserve
               available to all lines of business. Reserves are based on an
               estimate of potential inherent loss at a point in time and for
               discrete periods of time. The estimate is derived using a
               combination of empirically driven tests and management judgment.
               Each quarter, reserves are formally estimated by each line of
               business and reviewed and modified by Corporate Risk
               Management.





Analysis of Allowance for Credit Losses





|(In
                 millions)                                                                                  |  | 1999   |   | 1998 |        | 1997 |  | 1996   |  | 1995  
|--------------------------------------------------------------------------------------------------------------- |  | ------ | - | ---- | ------ | ---- |  | ------ |  | ------
|Balance, beginning of year                                                                                      |  | $2,271 |   |      | $2,817 |      |  | $2,687 |  | $2,422
|Provision for credit losses                                                                                     |  | 1,249  |   |      | 1,408  |      |  | 1,988  |  | 1,716 
|Charge-offs                                                                                                     |  |        |   |      |        |      |  |        |  |       
|Commercial                                                                                                      |  |        |   |      |        |      |  |        |  |       
|Domestic                                                                                                        |  |        |   |      |        |      |  |        |  |       
|Commercial                                                                                                      |  | 325    |   |      | 222    |      |  | 200    |  | 174   
|Real Estate
               
                         
                          
                  Construction |  | 5      |   |      | 3      |      |  | 3      |  | 3     
|Other                                                                                                           |  | 27     |   |      | 25     |      |  | 19     |  | 28    
|Lease financing                                                                                                 |  | 12     |   |      | 20     |      |  | 12     |  | 15    
|Foreign                                                                                                         |  | 41     |   |      | 52     |      |  |       |  | 2     
|                                                                                                                |  |        |   |      |        |      |  |        |  |       
|Total
                 commercial                                                                               |  | 410    |   |      | 322    |      |  | 234    |  | 222   
|Consumer
               
                        
                  Residential real estate                     |  | 189    |   |      | 74     |      |  | 52     |  | 32    
|Automotive                                                                                                      |  | 343    |   |      | 281    |      |  | 311    |  | 248   
|Other                                                                                                           |  | 203    |   |      | 246    |      |  | 256    |  | 209   
|                                                                                                                |  |        |   |      |        |      |  |        |  |       
|Total
                 consumer                                                                                 |  | 735    |   |      | 601    |      |  | 619    |  | 489   
|Credit card                                                                                                     |  | 386    |   |      | 1,022  |      |  | 1,544  |  | 1,216 
|                                                                                                                |  |        |   |      |        |      |  |        |  |       
|Total
                 charge-offs                                                                              |  | 1,531  |   |      | 1,945  |      |  | 2,397  |  | 1,927 
|Recoveries                                                                                                      |  |        |   |      |        |      |  |        |  |       
|Commercial                                                                                                      |  |        |   |      |        |      |  |        |  |       
|Domestic                                                                                                        |  |        |   |      |        |      |  |        |  |       
|Commercial                                                                                                      |  | 70     |   |      | 68     |      |  | 97     |  | 87    
|Real estate                                                                                                     |  |        |   |      |        |      |  |        |  |       
|Construction                                                                                                    |  | 6      |   |      | 3      |      |  | 6      |  | 10    
|Other                                                                                                           |  | 25     |   |      | 23     |      |  | 29     |  | 27    
|Lease financing                                                                                                 |  | 2      |   |      | 5      |      |  | 3      |  | 4     
|Foreign                                                                                                         |  | 1      |   |      | 1      |      |  | 12     |  | 15    
|                                                                                                                |  |        |   |      |        |      |  |        |  |       
|Total
                 commercial                                                                               |  | 104    |   |      | 100    |      |  | 147    |  | 143   
|Consumer                                                                                                        |  |        |   |      |        |      |  |        |  |       
|Residential real estate                                                                                         |  | 12     |   |      | 11     |      |  | 14     |  | 8     
|Automotive                                                                                                      |  | 105    |   |      | 113    |      |  | 122    |  | 98    
|Other                                                                                                           |  | 60     |   |      | 64     |      |  | 63     |  | 55    
|                                                                                                                |  |        |   |      |        |      |  |        |  |       
|Total
                 consumer                                                                                 |  | 177    |   |      | 188    |      |  | 199    |  | 161   
|Credit
                 card                                                                                    |  | 44     |   |      | 159    |      |  | 164    |  | 101   
|                                                                                                                |  |        |   |      |        |      |  |        |  |       
|Total
                 recoveries                                                                               |  | 325    |   |      | 447    |      |  | 510    |  | 405   
|Net
                 charge-offs                                                                                |  | 1,206  |   |      | 1,498  |      |  | 1,887  |  | 1,522 
|Other                                                                                                           |  | (29    | ) |      | (456   | )    |  | 29     |  | 71    
|                                                                                                                |  |        |   |      |        |      |  |        |  |       
|Balance, end of year                                                                                            |  | $2,285 |   |      | $2,271 |      |  | $2,817 |  | $2,687
|                                                                                                                |  |        |   |      |        |      |  |        |  |       




Other reductions
               in the allowance for credit losses during 1999 primarily
               represent the allocable credit reserves associated with
               completed consumer loan securitization transactions.





As part of the
               Banc One/FCN Merger integration, the accounting and credit
               practices associated with the Credit Card businesses were
               conformed, including the balance sheet classification of the
               Corporations retained interest in securitized credit card
               receivables (sellers interest), the timing of charge-offs
               and the appropriate reserves that should be maintained against
               remaining credit risk. Conforming these practices in the fourth
               quarter
             of 1998 resulted in the transfer of $375 million from the
               allowance for credit losses to a securities valuation account.
               As a result, such investment securities (sellers interest
               and interest-only strips) are carried at fair value. The
               remaining transfer was primarily related to First USAs
               contribution of its $1.6 billion private-label credit card
               portfolio to a new joint venture formed with GE Capital
               Corporation. During 1997, an additional $130 million provision
               for credit losses was taken as a result of the reclassification
               of credit card loans and to conform credit card charge-off
               policies in conjunction with the First USA
               acquisition.





Line of business
               reserve tests are based on empirical analysis of historical
               delinquency and loss experience for on- and off-balance sheet
               loan exposure. They are also based on application of approved
               charge-off policies, recovery policies, actual quarter-end
               balances/exposures and current portfolio performance trends. A
               corporate unallocated (subjective) reserve based on management
               s judgment and supported, in part, by portfolio stress
               testing is also maintained. Securitized or held-for-sale loans,
               including credit card receivables, are not subject to the
               reserve process.





The allowance
               for credit losses is intended to be an estimate of inherent
               losses in an existing portfolio at a point in time. Management
               bases its assessment of inherent losses on the expected default
               rate in the portfolio over a defined future time horizon and the
               expected loss rate in the event of default, considering the
               existence of collateral where appropriate.





It is Corporate
               Risk Managements responsibility to recommend a reserve and
               provision that results in adequate coverage of inherent losses
               within the Corporations credit portfolios. Corporate Risk
               Managements assessment is based on:





| | · | Review
                 and acceptance, or modification, of line of business reserve
                 tests that estimate probable losses inherent in various
                 portfolio segments using empirical methodologies.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




| | · | Determination of subjective or unallocated reserves
                 based on managements judgment of factors not fully
                 captured in line of business reserve tests.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




Allocated Reserves





The Corporation
               employs several different methodologies for estimating allocated
               reserves. Methodologies are determined based upon a number of
               factors, including type of asset (consumer installment versus
               commercial loan), risk measurement parameters (delinquency
               status and bureau score versus commercial risk rating), and risk
               management and collection process (retail collection center
               versus centrally managed workout units). Reserving methodologies
               generally fall into one of the following categories:





| | · | Empirically driven calculated reserves based on
                 expected loss.
| | - | -------------------------------------------------------------------------------




| | · | Asset-specific reserves based, in part, on
                 loan-specific analysis of collateral coverage.
| | - | ----------------------------------------------------------------------------------------------------------




For each of the
               consumer portfolios, including the credit card portfolio,
               reserves are established based on a statistical analysis of
               inherent loss over discrete periods of time. The analysis
               reviews historical losses, vintage performance, delinquencies
               and other risk characteristics of the various consumer products
               to estimate expected losses. These factors and the analysis are
               updated on a quarterly basis.





During the 1999
               fourth quarter, the Corporation refined its measurement process
               for estimating probable losses for its consumer product
               portfolio segments. To refine the process, the Corporation
               evaluated a variety of factors including recent loss experience
               in the consumer portfolios, changes in origination sources,
               portfolio seasoning and underlying credit practices, including
               charge-off policies. As a part of this refinement process, the
               Corporation adopted certain of the FFIECs new consumer
               charge-off guidelines, some of which require charge-offs to be
               recorded sooner than they would be under the Corporations
               previous standards. The adoption of these guidelines resulted in
               net charge-offs of $143 million. As a result of these policy
               changes and the assessment of the other relevant factors,
               management determined that an increased provision of $176
               million was required to
             maintain the reserve at an adequate level to absorb inherent
               losses. The Corporation does not anticipate that this one-time
               recalibration is indicative of ongoing credit provisions or net
               charge-offs in these consumer product portfolio segments. The
               Corporation continues to make periodic assessments of its
               probable loss measurement process and, based on current facts
               and economic conditions, does not believe significant near-term
               increases to the provision will be required.





For the
               commercial portfolio, the Corporation conducts a two-part test.
               First, significant credits that have a risk rating equivalent to
               the bank regulatory classifications of substandard, doubtful and
               loss are formally reviewed each quarter, and asset-specific
               reserves are established as appropriate. Second, inherent losses
               for the remaining commercial portfolio are estimated by
               assigning a specific reserve factor to each risk category of the
               portfolio based on a statistical analysis of historical loss
               experience over a discrete period of time. As the Corporation
               continues to gather more refined historical loss statistics for
               the merged Corporation, it will continue to refine its process
               to estimate inherent losses in the commercial
               portfolio.





Unallocated Reserves





Unallocated
               reserves are established based on managements judgment in
               order to appropriately reflect the presence of indicators of
               inherent losses that are not fully reflected in the historical
               loss information and analysis used in the development of
               allocated reserves. The factors considered in establishing the
               unallocated reserve include: nonperforming, charge-off,
               delinquency and portfolio growth and concentration trends;
               portfolio stress testing; and the likely impact of known changes
               in the economy or other events that may affect loss
               performance.





Portfolio stress
               testing has been conducted on the commercial portfolio since the
               first quarter of 1999. These tests are conducted to estimate a
               range of expected loss resulting from observed deterioration in
               certain industry sectors of the economy and/or the Corporation
               s downside macroeconomic forecast.





Corporate Risk
               Management also uses third party information and analysis to
               validate internal measures of credit quality and reserve
               adequacy. The line of business reserve tests, portfolio stress
               testing and third party information and analysis all contribute
               to the establishment of reference points used in evaluating the
               adequacy of the total reserve.





Composition of Allowance for Credit
               Losses





While the
               allowance for credit losses is available to absorb credit losses
               in the entire portfolio, the tables below present an estimate of
               the allowance for credit losses allocated by loan type and the
               percentage of loans in each category to total loans.





|December 31
               
               (Dollars in millions) |  | 1999                     |  | 1998 |   | 1997 |                          | 1996 |     | 1995
|---------------------------------------------------------------- |  | ------------------------ |  | ---- | - | ---- | ------------------------ | ---- | --- | ----
|Commercial                                                       |  | $
                   972 |  | 43   | % |      | $ 
                  834 |      | 37  | %   
|Consumer                                                         |  | 486                      |  | 21   |   |      | 440                      |      | 19  |     
|Credit
                 Card                                     |  | 148                      |  | 6    |   |      | 199                      |      | 9   |     
|Unallocated                                                      |  | 679                      |  | 30   |   |      | 798                      |      | 35  |     
|                                                                 |  |                          |  |      |   |      |                          |      |     |     
|Total                                                            |  | $2,285                   |  | 100  | % |      | $2,271                   |      | 100 | %   
|                                                                 |  |                          |  |      |   |      |                          |      |     |     
|Percentage of loans to total loans                               |  |                          |  |      |   |      |                          |      |     |     
|Commercial                                                       |  |                          |  | 59   | % |      |                          |      | 57  | %   
|Consumer                                                         |  |                          |  | 39   |   |      |                          |      | 37  |     
|Credit
                 Card                                     |  |                          |  | 2    |   |      |                          |      | 6   |     
|                                                                 |  |                          |  |      |   |      |                          |      |     |     
|Total                                                            |  |                          |  | 100  | % |      |                          |      | 100 | %   
|                                                                 |  |                          |  |      |   |      |                          |      |     |     




The increase in
               the allowance for credit losses in 1999 was a result of
               portfolio growth, higher net charge-off rates and increased
               nonperforming loans. The decrease in unallocated reserves during
               1999 is attributed to better identification of asset-specific
               and other allocated reserves in the commercial and consumer
               portfolios that resulted in reallocations from unallocated to
               allocated reserves. Credit card reserves declined during 1999 as
               a result of the increased level of securitizations. Year-end
               1998 reserves were 1.88 times subsequent 1999 net charge-offs,
               unchanged from the previous years reserve coverage
               ratio.





DERIVATIVE
             FINANCIAL
             INSTRUMENTS





The Corporation
               uses a variety of derivative financial instruments in its
               trading, asset and liability management, and corporate
               investment activities. These instruments include interest rate,
               currency, equity and commodity swaps, forwards, spot, futures,
               options, caps, floors, forward rate agreements, and other
               conditional or exchange contracts, and include both
               exchange-traded and over-the-counter contracts. See Note 20(c),
               beginning on page 67, for a discussion of the nature and terms
               of derivative financial instruments.





Notional Principal or Contractual Amounts of
               Derivative Financial Instruments





The following
               tables represent the gross notional principal or contractual
               amounts of outstanding derivative financial instruments used in
               certain activities. These amounts indicate the volume of
               transaction activity, and they do not represent the market or
               credit risk associated with these instruments. In addition,
               these volumes do not reflect the netting of offsetting
               transactions.





|December 31, 1999 (In billions)             |  | Trading                  |  | Asset and
               
               Liability
               
               Management |  | Total                   
|------------------------------------------- |  | ------------------------ |  | -------------------------------------------------------------------------------------------- |  | ------------------------
|Interest rate contracts                     |  | $
                   895 |  | $20                                                                                          |  | $
                   915
|Foreign
                 exchange contracts |  | 106                      |  | 1                                                                                            |  | 107                     
|Equity
                 contracts           |  | 10                       |  |                                                                                             |  | 10                      
|Commodity contracts                         |  | 1                        |  |                                                                                             |  | 1                       
|                                            |  |                          |  |                                                                                              |  |                         
|Total                                       |  | $1,012                   |  | $21                                                                                          |  | $1,033                  
|                                            |  |                          |  |                                                                                              |  |                         
|
|Interest rate contracts                     |  | $1,182                   |  | $26                                                                                          |  | $1,208                  
|Foreign
                 exchange contracts |  | 251                      |  | 3                                                                                            |  | 254                     
|Equity
                 contracts           |  | 9                        |  |                                                                                             |  | 9                       
|Commodity contracts                         |  | 2                        |  |                                                                                             |  | 2                       
|                                            |  |                          |  |                                                                                              |  |                         
|Total                                       |  | $1,444                   |  | $29                                                                                          |  | $1,473                  
|                                            |  |                          |  |                                                                                              |  |                         




Accounting for Derivative Financial
               Instruments





Derivative
               financial instruments used in trading activities are valued at
               estimated fair value. Such instruments include swaps, forwards,
               spot, futures, options, caps, floors and forward rate agreements
               and other conditional or exchange contracts in the interest
               rate, foreign exchange, equity and commodity markets. The
               estimated fair values are based on quoted market prices or
               pricing and valuation models on a present value basis using
               current market information. Realized and unrealized gains and
               losses are included in noninterest income as trading profits.
               Where appropriate, compensation for credit risk and ongoing
               servicing is deferred and recorded as income over the terms of
               the derivative financial instruments.





Derivative
               financial instruments used in ALM activities, principally
               interest rate swaps, are typically classified as synthetic
               alterations or anticipatory hedges and are required to meet
               specific criteria. Such interest rate swaps are designated as
               ALM derivatives, and are linked to and adjust the interest rate
               sensitivity of a specific asset, liability, firm commitment, or
               anticipated transaction or a specific pool of transactions with
               similar risk characteristics. Interest rate swaps that do not
               meet these and the following criteria are designated as
               derivatives used in trading activities and are accounted for at
               estimated fair value.





Synthetic
               Alteration(1) the asset or liability to be converted
               creates exposure to interest rate risk; (2) the swap is
               effective as a synthetic alteration of the balance sheet item;
               (3) the start date of the swap does not extend beyond that point
               in time at which it is believed that modeling systems produce
               reliable interest rate sensitivity information; and (4) the
               related balance sheet item, from trade date to final maturity,
               has sufficient balances for alteration.





Anticipatory Hedge(1) the transaction to be hedged
               creates exposure to interest rate risk; (2) the swap acts to
               reduce inherent rate risk by moving closer to being insensitive
               to interest rate changes; (3) the swap is effective as a hedge
               of the transaction; (4) the significant characteristics and
               expected terms of the anticipated transaction are identified;
               and (5) it is probable that the anticipated transaction will
               occur.





Income or
               expense on most ALM derivatives used to manage interest rate
               exposure is recorded on an accrual basis, as an adjustment to
               the yield of the linked exposures over the periods covered by
               the contracts. This matches the income recognition treatment of
               that exposure, generally assets or liabilities carried at
               historical cost, that are recorded on an accrual basis. If an
               interest rate swap is terminated early or dedesignated as an ALM
               derivative, any unrecognized gain or loss at that point in time
               is deferred and amortized as an adjustment of the yield on the
               linked interest rate exposure position over the remaining
               periods originally covered by the swap. If all or part of a
               linked position is terminated, e.g., a linked asset is sold or
               prepaid, or if the amount of an anticipated transaction is
               likely to be less than originally expected, then the related pro
               rata portion of any unrecognized gain or loss on the swap is
               recognized in earnings at that time, and the related pro rata
               portion of the swap is subsequently accounted for at estimated
               fair value.





Purchased
               option, cap and floor contracts are reported in derivative
               product assets, and written option, cap and floor contracts are
               reported in derivative product liabilities. For other derivative
               financial instruments, an unrealized gain is reported in
               derivative product assets, and an unrealized loss is reported in
               derivative product liabilities. However, fair value amounts
               recognized for derivative financial instruments executed with
               the same counterparty under a legally enforceable master netting
               arrangement are reported on a net basis. Cash flows from
               derivative financial instruments are reported net as operating
               activities.





Income
               Resulting from Derivative Financial Instruments





The Corporation
               uses interest rate derivative financial instruments to reduce
               structural interest rate risk and the volatility of net interest
               margin. Net interest margin reflects the effective use of these
               derivatives. Without their use, net interest income would have
               been lower by $181 million in 1999, lower by $78 million in 1998
               and lower by $54 million in 1997.





Deferred gains,
               net of deferred losses, on interest rate swaps terminated early
               or dedesignated as ALM derivatives totaled $169 million as of
               December 31, 1999. This amount will be amortized as an
               adjustment to interest income or expense on the linked interest
               rate exposure position. The net adjustment will be $72 million
               in 2000, $51 million in 2001, $28 million in 2002 and $18
               million thereafter.





Credit
               Exposure Resulting from Derivative Financial
               Instruments





The Corporation
               maintains risk management policies that monitor and limit
               exposure to credit risks. For a further discussion of credit
               risks, see the Credit Risk Management section,
               beginning on page 21.





Credit exposure
               from derivative financial instruments arises from the risk of a
               customer default on the derivative contract. The amount of loss
               created by the default is the replacement cost or current fair
               value of the defaulted contract. The Corporation utilizes master
               netting agreements whenever possible to reduce its credit
               exposure from customer default. These agreements allow the
               netting of contracts with unrealized losses against contracts
               with unrealized gains to the same customer, in the event of a
               customer default. The table below shows the impact of these
               master netting agreements.





|December 31 (In millions)                                                   |  | 1999                       |   | 1998
|--------------------------------------------------------------------------- |  | -------------------------- | - | ----
|Gross
                 replacement cost                                     |  | $12,254                    |   |     
|Less:
                 Adjustment due to master netting agreements          |  | (8,895                     | ) |     
|                                                                            |  |                            |   |     
|Current
                 credit exposure                                    |  | 3,359                      |   |     
|Unrecognized net (gains) losses due to nontrading
                 activity |  | 13                         |   |     
|                                                                            |  |                            |   |     
|Balance
                 sheet exposure                                     |  | $
                   3,372 |   |     
|                                                                            |  |                            |   |     




Current credit
               exposure represents the total loss that the Corporation would
               have suffered had every counterparty been in default on those
               dates. These amounts are adjusted by the unrealized and
               unrecognized gains and losses on derivatives used in asset and
               liability management activities to arrive at the balance sheet
               exposure.





LOAN
             SECURITIZATIONS





The Corporation
               transforms loans into securities, which are sold to investors, a
               process referred to as securitization. The Corporation primarily
               securitizes credit card receivables, but also securitizes home
               equity loans and other consumer assets. In a credit card
               securitization, a designated pool of credit card receivables is
               removed from the balance sheet and a security is sold to
               investors entitling them to receive specified cash flows during
               the life of the security. The Corporation receives (1) fees for
               servicing the receivables, and (2) net interest revenue, which
               includes the contractual interest and fees on the receivables
               less the interest paid to the investors, net credit losses and
               servicing fees.





The Corporation
               maintains an undivided, pro rata interest in the credit card
               securitized assets, referred to as sellers interest, which
               is generally equal to the pool of assets included in the
               securitization less the investors portion of those assets.
               As the amount of the loans in the securitized pool fluctuates
               due to customer payments, purchases, cash advances, and credit
               losses, the amount of the sellers interest will vary. This
               sellers interest is classified on the balance sheet as
               investment securitiesavailable for sale.





The following
               represents the balance sheet impact of the Corporations
               credit card securitizations at
             
             December 31, 1999 (in millions):





|Owned
                 credit card loans                                     |  | $ 
                  4,037
|---------------------------------------------------------------------------- |  | --------------------------
|Seller
                 s interest in credit card loans                     |  | 19,680                    
|                                                                             |  |                           
|Total
                 credit card loans reflected on balance sheet          |  | 23,717                    
|Securities sold to investors and removed from balance
                 sheet |  | 45,639                    
|                                                                             |  |                           
|Managed
                 credit card loans                                   |  | $69,356                   
|                                                                             |  |                           




At the time the
               Corporation enters into a securitization, an interest-only strip
               asset is recognized and the resulting gain or loss on sale is
               recorded in noninterest income as credit card revenue. The
               interest-only strip represents the present value of the net
               interest revenue related to the securitized loans and is also
               classified as investment securitiesavailable for sale.
               During the revolving period of a credit card securitization, an
               additional gain is recognized each month over the life of the
               transaction as additional receivables are sold. The
               interest-only strip is amortized as the securities sold to
               investors are repaid.





Certain
               estimates are used in determining the fair value of the
               interest-only strip, including net interest revenues, receivable
               lives and the discount rate. The components of net interest
               revenues, which are estimated, include finance charge and fee
               revenue (excluding interchange income) generated by the
               securitized loans in excess of interest paid to investors,
               related net credit losses and servicing fees. The resulting
               expected cash flows are discounted over the lives of the
               receivables to determine the fair value. Such estimates and
               assumptions are subject to change and, accordingly, the
               Corporation may not recover all of the recorded investment of
               the interest-only strips. The receivables in each trust have
               unique attributes; thus the interest-only strip related to each
               trust is evaluated separately. The weighted-average assumptions
               used to estimate the fair value of interest-only strips related
               to credit card securitizations as of December 31, 1999, were as
               follows:





|Net
                 interest revenue (including net credit losses of 6.56% per
                 annum) |  | 3.13                      | %
|------------------------------------------------------------------------------------------------------- |  | ------------------------- | -
|Receivable lives                                                                                        |  | 6
                 months |  
|Discount rate                                                                                           |  | 10.00                     | %




Sellers
               interest resulting from credit card securitizations is recorded
               at fair value using a present value approach; the assumptions
               are consistent with the valuation of the interest-only strips.
               At December 31, 1999, the estimated fair value of sellers
               interest and interest-only strips from credit card
               securitizations were as follows (in millions):





|Seller
                 s interest |  | $19,766
|----------------------------------- |  | -------
|Interest-only strips                |  | 689    




Credit
               enhancements associated with credit card securitizations, such
               as cash collateral or spread accounts, total $279 million at
               December 31, 1999, and are classified on the balance sheet as
               other assets. A servicing asset or liability is not generally
               recognized in a credit card securitization since the Corporation
               receives adequate compensation relative to current market
               servicing prices to service the receivables sold. Transaction
               costs in credit card securitizations are typically deferred and
               amortized over the life of the security as a reduction of
               noninterest income. Other securitization transaction costs are
               included in the gain or loss on sale.





The asset values
               of sellers interest, interest-only strips and credit
               enhancements are periodically reviewed for other-than-temporary
               impairment.





YEAR
             2000 READINESS
             DISCLOSURE





Throughout 1999,
               the Corporation executed project plans to assure Year 2000
               readiness. These plans included verifying the readiness of
               internal information technology systems and equipment, and
               working with external entities, including customers, vendors,
               utilities and governmental agencies, to verify that they had
               appropriately addressed Year 2000 readiness issues. Specific
               business continuity and event plans were designed to address
               potential disruption and ensure that the Corporation was
               positioned to rapidly respond to issues.





The Corporation
               had estimated total Year 2000 readiness costs to reach $350
               million over the life of the project, and incurred total costs
               of approximately $343 million.





The Corporation
               had an uneventful transition to the Year 2000. The Corporation
               s systems, equipment and facilities continued and continue
               to function normally through the transition and into Year 2000.
               Normal products and services of the Corporation have been
               available to customers throughout such time, and the Corporation
               experienced no significant impact from the Year 2000 readiness
               status of external entities. To meet potential Year 2000
               contingencies and potential liquidity needs, the Corporation
               increased the value of loans pledged to the Federal Reserve for
               discount window borrowing. See Note 23 on page 70.





On an ongoing
               basis, the Corporation will continue to monitor its systems,
               equipment and facilities throughout 2000 and beyond.





CAPITAL
             MANAGEMENT





Capital
               represents the stockholders investment on which the
               Corporation strives to generate attractive returns. It is the
               foundation of a cohesive risk management framework and links
               return with risk. Capital supports business growth and provides
               protection to depositors and creditors.





Key capital
               management objectives are to:





| | · | generate attractive returns to enhance shareholder
                 value;
| | - | --------------------------------------------------------------------------




| | · | maintain a capital base commensurate with overall risk
                 profile;
| | - | --------------------------------------------------------------------------------




| | · | maintain strong capital ratios relative to those of
                 peers; and
| | - | -------------------------------------------------------------------------------




| | · | meet or
                 exceed all regulatory guidelines.
| | - | ----------------------------------------------------------




In conjunction
               with the annual financial planning process, a capital plan is
               established to ensure that the Corporation and all of its
               subsidiaries have capital structures consistent with prudent
               management principles and regulatory requirements.





Economic Capital





An important
               aspect of risk management and performance measurement is the
               ability to evaluate the risk and return of a business unit,
               product or customer consistently across all lines of business.
               The Corporations economic capital framework facilitates
               this standard measure of risk and return. Business units are
               assigned capital consistent with the underlying risks of their
               product set, customer base and delivery channels. The following
               principles are inherent in the capital attribution
               employed:





| | · | An
                 equal amount of capital is assigned for each measured unit of
                 risk.
| | - | --------------------------------------------------------------------------------------------------------




| | · | Risk is
                 defined in terms of unexpected losses over the
                 life of the exposure, measured at a confidence interval
                 consistent with that level of capitalization necessary to
                 achieve a targeted AA debt rating. Unexpected losses are in
                 excess of those normally incurred and for which reserves are
                 maintained.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




| | · | Business units are assessed a uniform charge against
                 allotted capital, representing a target hurdle rate on equity
                 investments. Returns on capital in excess of the hurdle rate
                 contribute to increases in shareholder value.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




Four forms of
               risk are measuredcredit, market, operational and lease
               residual. Credit capital is determined through an analysis of
               both historical loss experience and market expectations. Market
               risk capital is set consistent with exposure limits established
               by the Corporations risk oversight committees. Operational
               risk capital incorporates event and technology risks, as well as
               the general business risks arising from operating leverage. The
               operating risk evaluation process involves an examination of
               various risk factors that contribute to a greater likelihood of
               loss due to business failure, fraud or processing error.
               Finally, residual risk covers the potential for losses arising
               from the disposition of assets returned at the end of lease
               contracts. This price risk is analyzed based upon historical
               loss experiences and market factors, as well as by reviewing
               event-specific scenarios.





The capital
               attributions in the Business Segments section,
               beginning on page 3, were developed through this
               process.





Selected Capital Ratio Review





The Corporation
               aims to maintain regulatory capital ratios, including those of
               the principal banking subsidiaries, in excess of the
               well-capitalized guidelines under federal banking regulations.
               The Corporation has maintained a well-capitalized regulatory
               position over the past five years. In addition, its principal
               banking subsidiaries have met or exceeded the well-capitalized
               guidelines for the past two years, as shown in Note 13,
               beginning on page 55.





The tangible
               common equity to managed assets ratio is also monitored, with a
               current target range of 5%7%. This ratio adds securitized
               credit card loans to reported total assets and is calculated net
               of total intangible assets.





Selected Capital Ratios





|December 31                                                                        |  | 1999 |   | 1998 |      | 1997 |  | 1996 |   | 1995 |      | Corporate
               
               Targets |  | Well-Capitalized
               
               Regulatory
               
               Guidelines
|---------------------------------------------------------------------------------- |  | ---- | - | ---- | ---- | ---- |  | ---- | - | ---- | ---- | ------------------------------------------------ |  | ----------------------------------------------------------------------------------------------------
|Risk-based capital ratios (1)                                                      |  |      |   |      |      |      |  |      |   |      |      |                                                  |  |                                                                                                     
|Tier
                 1                                                            |  | 7.7  | % |      | 7.9  | %    |  | 8.2  | % |      | 9.5  | %                                                |  | 9.0                                                                                                 
|Total                                                                              |  | 10.7 |   |      | 11.3 |      |  | 12.3 |   |      | 13.6 |                                                  |  | 13.0                                                                                                
|Leverage ratio (1)(2)                                                              |  | 7.7  |   |      | 8.0  |      |  | 7.8  |   |      | 8.9  |                                                  |  | 7.8                                                                                                 
|Tangible common equity/tangible managed
               
                    assets |  | 5.7  |   |      | 5.8  |      |  | 6.2  |   |      | 6.9  |                                                  |  | 6.4                                                                                                 
|Double
                 leverage ratio (1)                                         |  | 112  |   |      | 108  |      |  | 107  |   |      | 107  |                                                  |  | 108                                                                                                 
|Dividend payout ratio                                                              |  | 57   |   |      | 58   |      |  | 61   |   |      | 38   |                                                  |  | 40                                                                                                  
|Common
                 equity/total assets                                        |  | 7.4  |   |      | 7.8  |      |  | 7.8  |   |      | 8.3  |                                                  |  | 7.6                                                                                                 
|Stockholders equity/total assets                                                  |  | 7.5  |   |      | 7.9  |      |  | 8.0  |   |      | 8.6  |                                                  |  | 7.9                                                                                                 




|(1) | Includes trust preferred capital
                 securities.
|--- | -------------------------------------------------------------

|(2) | Minimum
                 regulatory guideline is 3.0%.
|--- | ------------------------------------------------------




The components
               of the Corporations regulatory risk-based capital and
               risk-weighted assets are shown below:





|December 31 (In millions)                   |  | 1999                        |  | 1998                        |  | 1997                        |  | 1996                        |  | 1995                       
|------------------------------------------- |  | --------------------------- |  | --------------------------- |  | --------------------------- |  | --------------------------- |  | ---------------------------
|Regulatory risk-based capital               |  |                             |  |                             |  |                             |  |                             |  |                            
|Tier 1
                 capital             |  | $
                   20,247 |  | $ 
                  19,495 |  | $ 
                  17,958 |  | $ 
                  19,241 |  | $ 
                  16,862
|Tier 2
                 capital             |  | 7,967                       |  | 8,295                       |  | 9,000                       |  | 8,196                       |  | 7,504                      
|                                            |  |                             |  |                             |  |                             |  |                             |  |                            
|Total
                 capital              |  | $
                   28,214 |  | $ 
                  27,790 |  | $ 
                  26,958 |  | $ 
                  27,437 |  | $ 
                  24,366
|                                            |  |                             |  |                             |  |                             |  |                             |  |                            
|Total
                 risk-weighted assets |  | $263,169                    |  | $244,473                    |  | $219,557                    |  | $202,213                    |  | $186,758                   
|                                            |  |                             |  |                             |  |                             |  |                             |  |                            




In deriving Tier
               1 and total capital, goodwill and other nonqualifying intangible
               assets are deducted. The amount of qualifying and nonqualifying
               intangible assets for the past five years is shown
               below.





Intangible Assets





|December 31 (In millions)                        |  | 1999                     |  | 1998   |  | 1997   |  | 1996                     |  | 1995                    
|------------------------------------------------ |  | ------------------------ |  | ------ |  | ------ |  | ------------------------ |  | ------------------------
|Goodwill                                         |  | $
                   934 |  | $1,075 |  | $1,120 |  | $ 
                  920 |  | $ 
                  808
|Other
                 nonqualifying intangibles |  | 669                      |  | 637    |  | 109    |  | 61                       |  | 97                      
|                                                 |  |                          |  |        |  |        |  |                          |  |                         
|Subtotal                                         |  | 1,603                    |  | 1,712  |  | 1,229  |  | 981                      |  | 905                     
|Qualifying intangibles                           |  | 583                      |  | 984    |  | 473    |  | 278                      |  | 391                     
|                                                 |  |                          |  |        |  |        |  |                          |  |                         
|Total
                 intangibles               |  | $2,186                   |  | $2,696 |  | $1,702 |  | $1,259                   |  | $1,296                  
|                                                 |  |                          |  |        |  |        |  |                          |  |                         




Dividends





The Corporation
               s common dividend policy reflects its earnings outlook,
               desired payout ratios, the need to maintain an adequate capital
               level and alternative investment opportunities. The common
               dividend payout ratio is targeted in the range of 35%40%
               of earnings over time; however, the Corporation expects its
               near-term payout ratio to be in the 40%60% range. On
               January 18, 2000, the Corporation declared its quarterly common
               cash dividend of $0.42 per share, the same as the 1999 dividend
               rate.





On January 20,
               1998, Banc One declared a 10% common stock dividend to
               shareholders of record on February 12, 1998. On January 18,
               2000, the Corporation announced the discontinuation of the
               biannual 10% stock dividend.





Double Leverage





Double leverage
               is the extent to which the Corporations debt is used to
               finance investments in subsidiaries. Currently, double leverage
               is targeted at no more than 120% at any time. Double leverage
               was 112% at December 31, 1999, and 108% at December 31, 1998.
               Trust Preferred Capital Securities of $1.578 billion in 1999 and
               $1.003 billion in 1998 were included in capital for purposes of
               this calculation.





Stock
               Repurchase Program





On May 18, 1999,
               the Corporations Board of Directors authorized the
               purchase of up to 65 million shares of the Corporations
               common stock. As of December 31, 1999, the Corporation had
               purchased 36.6 million shares of common stock at an average
               price of $44.95 per share.





The Corporation
               s predecessors, Banc One and FCN, each had stock
               repurchase programs that were rescinded on May 14, 1997, and
               April 10, 1998, respectively.





Other
               Capital Activities





In September
               1999, a wholly owned consolidated trust subsidiary of the
               Corporation issued $575 million of preferred securities,
               bringing the total issued on behalf of the Corporation to $1.578
               billion. These Trust Preferred Capital Securities
               are tax-advantaged issues that qualify for Tier 1 capital
               treatment.





On August 10,
               1999, the Corporation redeemed all of its outstanding
               7 1 / 2 %
               Preferred Purchase Units, totaling $150 million. The redemption
               price was $25.00 per unit, plus accrued and unpaid interest and
               contract fees totaling $0.47 per unit.





On April 16,
               1998, the Corporation redeemed all shares of its Series C
               Convertible Preferred Stock at the redemption price of $51.05
               per share plus the amount of any dividends accrued and
               unpaid.





During 1999 and
               1998, the Corporation strengthened its capital position through
               the issuance of $350 million and $500 million of subordinated
               debt, respectively.





FORWARD
             -LOOKING
             STATEMENTS





Certain
               statements contained in this Annual Report on Form 10-K that are
               not statements of historical fact constitute forward-looking
               statements within the meaning of the Private Securities
               Litigation Reform Act of 1995 (the Act), including,
               without limitation, the statements specifically identified as
               forward-looking statements within this document. In addition,
               certain statements in future filings by the Corporation with the
               Securities and Exchange Commission, in press releases, and in
               oral and written statements made by or with the approval of the
               Corporation which are not statements of historical fact
               constitute forward-looking statements within the meaning of the
               Act. Examples of forward-looking statements include, but are not
               limited to: (i) projections of revenues, income or loss,
               earnings or loss per share, the payment or nonpayment of
               dividends, capital structure and other financial items; (ii)
               statements of plans and objectives of the Corporation or its
               management or Board of Directors, including those relating to
               products or services; (iii) statements of future economic
               performance; and (iv) statements of assumptions underlying such
               statements. Words such as believes, anticipates
               , expects, intends, targeted
                and similar expressions are intended to identify
               forward-looking statements but are not the exclusive means of
               identifying such statements.





In particular,
               this Annual Report on Form 10-K contains forward-looking
               statements that include but are not limited to (i) anticipated
               trends or target results in each line of business, especially
               pertaining to the targeted recovery and levels of profitability
               in the credit card business, (ii) anticipated credit loss
               trends, especially pertaining to credit card; (iii) the adequacy
               of the allowance for credit losses; (iv) interest rate risk
               management; and (v) the effect of legal proceedings on the
               Corporations consolidated financial position, liquidity or
               results of operations.





Forward-looking statements involve risks and uncertainties that
               may cause actual results to differ materially from those in such
               statements. Factors that could cause actual results to differ
               from those discussed in the forward-looking statements include,
               but are not limited to: (i) local, regional and international
               economic conditions; (ii) the effects of and changes in trade,
               monetary and fiscal policies and laws, including interest rate
               policies of the Federal Reserve Board; (iii) inflation, interest
               rate, market and monetary fluctuations; (iv) the timely
               development and acceptance of new products and services and
               perceived overall value of these products and services by users;
               (v) changes in consumer spending, borrowing and saving habits;
               (vi) technological changes; (vii) acquisitions and integration
               of acquired businesses; (viii) the ability to increase market
               share and control expenses; (ix) changes in the competitive
               environment among financial services companies; (x) the effect
               of changes in laws and regulations (including laws and
               regulations concerning taxes, banking, securities and insurance)
               with which the Corporation and its subsidiaries must comply;
               (xi) the effect of changes in accounting policies and practices,
               as may be adopted by the regulatory agencies as well as the
               Financial Accounting Standards Board; (xii) changes in the
               Corporations organization, compensation and benefit plans;
               (xiii) the costs and effects of litigation and of unexpected or
               adverse outcomes in such litigation; (xiv) costs or difficulties
               related to the integration of the businesses of Banc One and FCN
               being greater than expected; and (xv) the Corporations
               success at managing the risks involved in the
               foregoing.





Such
               forward-looking statements speak only as of the date on which
               such statements are made. The Corporation undertakes no
               obligation to update any forward-looking statement to reflect
               events or circumstances after the date on which such statement
               is made, or to reflect the occurrence of unanticipated
               events.





CONSOLIDATED
             BALANCE
             SHEET





BANK
               ONE CORPORATION and Subsidiaries





|December 31 (Dollars in
                  millions)                                                     |  | 1999                        |   | 1998     
|------------------------------------------------------------------------------------------------------- |  | --------------------------- | - | ---------
|Assets                                                                                                 
|Cash
                 and due from banks                                                                |  | $
                   16,076 |   |          
|Interest-bearing due from banks                                                                         |  | 6,645                       |   |          
|Federal
                 funds sold and securities under resale agreements                              |  | 9,782                       |   |          
|Trading
                 assets                                                                         |  | 7,952                       |   |          
|Derivative product assets                                                                               |  | 3,372                       |   |          
|Investment securities                                                                                   |  | 47,912                      |   |          
|Loans
                 (net of unearned income$4,075 in 1999 and $3,707 in
                 1998)     
|Commercial                                                                                              |  | 96,352                      |   |          
|Consumer                                                                                                |  | 63,488                      |   |          
|Credit
                 card                                                                            |  | 4,037                       |   |          
|Allowance for credit losses                                                                             |  | (2,285                      | ) |          
|                                                                                                        |  |                             |   |          
|Loans,
                 net                                                                             |  | 161,592                     |   |          
|Bank
                 premises and equipment, net                                                       |  | 3,317                       |   |          
|Customers acceptance liability                                                                         |  | 366                         |   |          
|Other
                 assets                                                                           |  | 12,411                      |   |          
|                                                                                                        |  |                             |   |          
|Total
                 assets                                                                           |  | $269,425                    |   |          
|                                                                                                        |  |                             |   |          
|Liabilities                                                                                            
|Deposits                                                                                               
|Demand                                                                                                  |  | $
                   31,194 |   |          
|Savings                                                                                                 |  | 64,435                      |   |          
|Time                                                                                                    |  | 36,877                      |   |          
|Foreign
                 offices                                                                        |  | 29,772                      |   |          
|                                                                                                        |  |                             |   |          
|Total
                 deposits                                                                         |  | 162,278                     |   |          
|Federal
                 funds purchased and securities under repurchase
                 agreements    |  | 18,720                      |   |          
|Other
                 short-term borrowings                                                            |  | 21,211                      |   |          
|Long-term debt                                                                                          |  | 33,857                      |   |          
|Guaranteed preferred beneficial interest in the
                 Corporations junior subordinated debt |  | 1,578                       |   |          
|Acceptances outstanding                                                                                 |  | 366                         |   |          
|Derivative product liabilities                                                                          |  | 3,332                       |   |          
|Other
                 liabilities                                                                      |  | 7,993                       |   |          
|                                                                                                        |  |                             |   |          
|Total
                 liabilities                                                                      |  | 249,335                     |   |          
|Stockholders Equity                                                                                   
|Preferred stock                                                                                         |  | 190                         |   |          
|Common
                 stock$0.01 par value                                                           |  | 12                          |   |          
|                                                                                                       
|
|Authorized                                                                                              |  | 2,500,000                   |   | 2,500,000
|Issued                                                                                                  |  | 1,182,121                   |   | 1,179,297
|Outstanding                                                                                             |  | 1,147,343                   |   | 1,177,310
|Surplus                                                                                                 |  | 10,799                      |   |          
|Retained earnings                                                                                       |  | 11,037                      |   |          
|Accumulated other adjustments to stockholders
                 equity                                  |  | (263                        | ) |          
|Deferred compensation                                                                                   |  | (118                        | ) |          
|Treasury stock at cost, 34,778,000 shares in 1999 and
                 1,987,000 shares in 1998         |  | (1,567                      | ) |          
|                                                                                                        |  |                             |   |          
|Total
                 stockholders equity                                                             |  | 20,090                      |   |          
|                                                                                                        |  |                             |   |          
|Total
                 liabilities and stockholders equity                                             |  | $269,425                    |   |          
|                                                                                                        |  |                             |   |          




The
               accompanying notes are an integral part of this
               statement.





CONSOLIDATED
             INCOME
             STATEMENT





BANK
               ONE CORPORATION and Subsidiaries





|For
                 the Year Ended December 31 (In millions, except per share
                 data) |  | 1999                        |  | 1998                        |  | 1997                       
|----------------------------------------------------------------------------------------------------- |  | --------------------------- |  | --------------------------- |  | ---------------------------
|Interest Income                                                                                      
|Loans,
                 including fees                                                                |  | $13,051                     |  | $14,106                     |  | $14,790                    
|Bank
                 balances                                                                        |  | 233                         |  | 331                         |  | 451                        
|Federal
                 funds sold and securities under resale agreements                            |  | 445                         |  | 423                         |  | 350                        
|Trading
                 assets                                                                       |  | 428                         |  | 367                         |  | 330                        
|Investment securitiestaxable                                                                         |  | 2,796                       |  | 2,136                       |  | 1,443                      
|Investment securitiestax-exempt                                                                      |  | 341                         |  | 161                         |  | 181                        
|                                                                                                      |  |                             |  |                             |  |                            
|Total                                                                                                 |  | 17,294                      |  | 17,524                      |  | 17,545                     
|                                                                                                     
|Interest Expense                                                                                     
|Deposits                                                                                              |  | 4,651                       |  | 4,943                       |  | 4,991                      
|Federal
                 funds purchased and securities under repurchase
                 agreements  |  | 935                         |  | 1,090                       |  | 1,073                      
|Other
                 short-term borrowings                                                          |  | 942                         |  | 737                         |  | 786                        
|Long-term debt                                                                                        |  | 1,745                       |  | 1,407                       |  | 1,234                      
|                                                                                                      |  |                             |  |                             |  |                            
|Total                                                                                                 |  | 8,273                       |  | 8,177                       |  | 8,084                      
|                                                                                                     
|Net
                 Interest Income                                                                  |  | 9,021                       |  | 9,347                       |  | 9,461                      
|Provision for credit losses                                                                           |  | 1,249                       |  | 1,408                       |  | 1,988                      
|                                                                                                      |  |                             |  |                             |  |                            
|Net
                 Interest Income After Provision for Credit
                 Losses               |  | 7,772                       |  | 7,939                       |  | 7,473                      
|                                                                                                     
|Noninterest Income                                                                                   
|Trading
                 profits                                                                      |  | 147                         |  | 141                         |  | 117                        
|Equity
                 securities gains                                                              |  | 415                         |  | 250                         |  | 334                        
|Investment securities gains                                                                           |  | 94                          |  | 155                         |  | 101                        
|                                                                                                      |  |                             |  |                             |  |                            
|Market-driven revenue                                                                                 |  | 656                         |  | 546                         |  | 552                        
|Credit
                 card revenue                                                                  |  | 3,427                       |  | 3,276                       |  | 2,508                      
|Fiduciary and investment management fees                                                              |  | 793                         |  | 807                         |  | 746                        
|Service
                 charges and commissions                                                      |  | 2,785                       |  | 2,645                       |  | 2,391                      
|                                                                                                      |  |                             |  |                             |  |                            
|Fee-based revenue                                                                                     |  | 7,005                       |  | 6,728                       |  | 5,645                      
|Other
                 income                                                                         |  | 1,031                       |  | 797                         |  | 497                        
|                                                                                                      |  |                             |  |                             |  |                            
|Total                                                                                                 |  | 8,692                       |  | 8,071                       |  | 6,694                      
|                                                                                                     
|Noninterest Expense                                                                                  
|Salaries and employee benefits                                                                        |  | 4,271                       |  | 4,477                       |  | 4,224                      
|Net
                 occupancy and equipment expense                                                  |  | 910                         |  | 845                         |  | 739                        
|Depreciation and amortization                                                                         |  | 697                         |  | 680                         |  | 693                        
|Outside
                 service fees and processing                                                  |  | 1,743                       |  | 1,349                       |  | 1,145                      
|Marketing and development                                                                             |  | 1,188                       |  | 1,024                       |  | 837                        
|Communication and transportation                                                                      |  | 829                         |  | 781                         |  | 711                        
|Merger-related and restructuring charges                                                              |  | 554                         |  | 1,062                       |  | 337                        
|Other                                                                                                 |  | 1,298                       |  | 1,327                       |  | 1,054                      
|                                                                                                      |  |                             |  |                             |  |                            
|Total                                                                                                 |  | 11,490                      |  | 11,545                      |  | 9,740                      
|                                                                                                     
|Income Before Income Taxes                                                                            |  | 4,974                       |  | 4,465                       |  | 4,427                      
|Applicable income taxes                                                                               |  | 1,495                       |  | 1,357                       |  | 1,467                      
|                                                                                                      |  |                             |  |                             |  |                            
|Net
                 Income                                                                           |  | $
                   3,479  |  | $ 
                  3,108  |  | $ 
                  2,960 
|                                                                                                      |  |                             |  |                             |  |                            
|Net
                 Income Attributable to Common Stockholders
                 Equity              |  | $
                   3,467  |  | $ 
                  3,094  |  | $ 
                  2,921 
|                                                                                                      |  |                             |  |                             |  |                            
|Earnings Per Share                                                                                   
|Basic                                                                                                 |  | $
                     2.97 |  | $ 
                    2.65 |  | $ 
                    2.48
|Diluted                                                                                               |  | $
                     2.95 |  | $ 
                    2.61 |  | $ 
                    2.43




The
               accompanying notes are an integral part of this
               statement.





CONSOLIDATED
             STATEMENT OF
             STOCKHOLDERS
             EQUITY





BANK
               ONE CORPORATION and Subsidiaries





|(In
                 millions)                                                                                                                       |  | Preferred
               
               Stock |   | Common
               
               Stock |     | Surplus |         | Retained
               
               Earnings |  | Accumulated
               
               Other
               
               Adjustments to
               
               Stockholders
               
               Equity |   | Deferred
               
               Compensation |                         | Treasury
               
               Stock |  | Total
               
               Stockholders
               
               Equity
|---------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------------- | - | ------------------------------------------- | --- | ------- | ------- | ------------------------------------------------ |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | - | ---------------------------------------------------- | ----------------------- | --------------------------------------------- |  | ----------------------------------------------------------------------------------------
|BalanceDecember 31, 1996                                                                                                                            |  | $651                                           |   |                                             | $12 |         | $10,030 |                                                  |  | $ 
                  9,373                                                                                                                                                        |   |                                                      | $ 
                  88 |                                               |  | $ 
                  (94                                                                
|Net
                 income                                                                                                                          |  |                                                |   |                                             |     |         |         |                                                  |  | 2,960                                                                                                                                                                             |   |                                                      |                         |                                               |  |                                                                                         
|Change
                 in fair value, investment securities
               
               available for sale, net of taxes                        |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      | 122                     |                                               |  |                                                                                         
|Translation gain(loss), net of taxes                                                                                                                 |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      | (1                      | )                                             |  |                                                                                         
|                                                                                                                                                     |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|Net
                 income and changes in accumulated other
               
                   adjustments to stockholders
                 equity |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|Cash
                 dividends declared                                                                                                            
|On common
                 stock                                                                                                                     |  |                                                |   |                                             |     |         |         |                                                  |  | (769                                                                                                                                                                              | ) |                                                      |                         |                                               |  |                                                                                         
|On preferred
                 stock                                                                                                                  |  |                                                |   |                                             |     |         |         |                                                  |  | (12                                                                                                                                                                               | ) |                                                      |                         |                                               |  |                                                                                         
|On common stock by
                 pooled affiliates                                                                                                |  |                                                |   |                                             |     |         |         |                                                  |  | (568                                                                                                                                                                              | ) |                                                      |                         |                                               |  |                                                                                         
|On preferred stock
                 by pooled affiliates                                                                                             |  |                                                |   |                                             |     |         |         |                                                  |  | (27                                                                                                                                                                               | ) |                                                      |                         |                                               |  |                                                                                         
|Conversion of preferred stock                                                                                                                        |  | (225                                           | ) |                                             |     |         | (67     | )                                                |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|Redemption of preferred stock                                                                                                                        |  | (100                                           | ) |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|Issuance of stock                                                                                                                                    |  |                                                |   |                                             |     |         | 56      |                                                  |  | (4                                                                                                                                                                                | ) |                                                      |                         |                                               |  |                                                                                         
|Acquisition of subsidiaries                                                                                                                          |  |                                                |   |                                             |     |         | 51      |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|Conversion of stock appreciation rights to stock
               
                   options                                                          |  |                                                |   |                                             |     |         | 10      |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|Purchase of common stock                                                                                                                             |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|Cancellation of shares held in treasury                                                                                                              |  |                                                |   |                                             |     |         | (442    | )                                                |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|10%
                 common stock dividend at fair market
               
                   value                                                   |  |                                                |   |                                             |     |         | 2,890   |                                                  |  | (2,890                                                                                                                                                                            | ) |                                                      |                         |                                               |  |                                                                                         
|Awards
                 granted, net of forfeitures and
               
                   amortization                                              |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  | (14                                                                                     
|Other                                                                                                                                                |  |                                                |   |                                             |     |         | 56      |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  | (29                                                                                     
|                                                                                                                                                     |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|BalanceDecember 31, 1997                                                                                                                            |  | 326                                            |   |                                             | 12  |         | 12,584  |                                                  |  | 8,063                                                                                                                                                                             |   |                                                      | 209                     |                                               |  | (137                                                                                    
|Net
                 income                                                                                                                          |  |                                                |   |                                             |     |         |         |                                                  |  | 3,108                                                                                                                                                                             |   |                                                      |                         |                                               |  |                                                                                         
|Change
                 in fair value, investment securities
               
               available for sale, net of taxes                        |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      | 15                      |                                               |  |                                                                                         
|Translation gain(loss), net of taxes                                                                                                                 |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      | 15                      |                                               |  |                                                                                         
|                                                                                                                                                     |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|Net
                 income and changes in accumulated other
               
                   adjustments to stockholders
                 equity |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|Cash
                 dividends declared                                                                                                            
|On common
                 stock                                                                                                                     |  |                                                |   |                                             |     |         |         |                                                  |  | (1,228                                                                                                                                                                            | ) |                                                      |                         |                                               |  |                                                                                         
|On preferred
                 stock                                                                                                                  |  |                                                |   |                                             |     |         |         |                                                  |  | (5                                                                                                                                                                                | ) |                                                      |                         |                                               |  |                                                                                         
|On common stock by
                 pooled affiliates                                                                                                |  |                                                |   |                                             |     |         |         |                                                  |  | (401                                                                                                                                                                              | ) |                                                      |                         |                                               |  |                                                                                         
|On preferred stock
                 by pooled affiliates                                                                                             |  |                                                |   |                                             |     |         |         |                                                  |  | (9                                                                                                                                                                                | ) |                                                      |                         |                                               |  |                                                                                         
|Conversion of preferred stock                                                                                                                        |  | (136                                           | ) |                                             |     |         | 136     |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|Issuance of stock                                                                                                                                    |  |                                                |   |                                             |     |         | (189    | )                                                |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|Acquisition of subsidiaries                                                                                                                          |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|Purchase of common stock                                                                                                                             |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|Cancellation of shares held in treasury                                                                                                              |  |                                                |   |                                             |     |         | (1,866  | )                                                |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|Awards
                 granted, net of forfeitures and
               
                   amortization                                              |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  | 29                                                                                      
|Other                                                                                                                                                |  |                                                |   |                                             |     |         | 104     |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  | 14                                                                                      
|                                                                                                                                                     |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|BalanceDecember 31, 1998                                                                                                                            |  | 190                                            |   |                                             | 12  |         | 10,769  |                                                  |  | 9,528                                                                                                                                                                             |   |                                                      | 239                     |                                               |  | (94                                                                                     
|Net
                 income                                                                                                                          |  |                                                |   |                                             |     |         |         |                                                  |  | 3,479                                                                                                                                                                             |   |                                                      |                         |                                               |  |                                                                                         
|Change
                 in fair value, investment securities                                                                                        |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|available for sale, net of taxes                                                                                                                     |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      | (489                    | )                                             |  |                                                                                         
|Translation gain(loss), net of taxes                                                                                                                 |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      | (13                     | )                                             |  |                                                                                         
|                                                                                                                                                     |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|Net
                 income and changes in accumulated other
               
                   adjustments to stockholders
                 equity |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|Cash
                 dividends declared                                                                                                            
|On common
                 stock                                                                                                                     |  |                                                |   |                                             |     |         |         |                                                  |  | (1,958                                                                                                                                                                            | ) |                                                      |                         |                                               |  |                                                                                         
|On preferred
                 stock                                                                                                                  |  |                                                |   |                                             |     |         |         |                                                  |  | (12                                                                                                                                                                               | ) |                                                      |                         |                                               |  |                                                                                         
|Issuance of stock                                                                                                                                    |  |                                                |   |                                             |     |         | (14     | )                                                |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|Purchase of common stock                                                                                                                             |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|Awards
                 granted, net of forfeitures and
               
                   amortization                                              |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  | (24                                                                                     
|Other                                                                                                                                                |  |                                                |   |                                             |     |         | 44      |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|                                                                                                                                                     |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         
|BalanceDecember 31, 1999                                                                                                                            |  | $190                                           |   |                                             | $12 |         | $10,799 |                                                  |  | $11,037                                                                                                                                                                           |   |                                                      | $(263                   | )                                             |  | $(118                                                                                   
|                                                                                                                                                     |  |                                                |   |                                             |     |         |         |                                                  |  |                                                                                                                                                                                   |   |                                                      |                         |                                               |  |                                                                                         




The
               accompanying notes are an integral part of this
               statement.





CONSOLIDATED
             STATEMENT OF
             CASH
             FLOWS





BANK
               ONE CORPORATION and Subsidiaries





|For
                 the Year (In millions)                                                                                     |  | 1999                         |   | 1998 |                              | 1997
|------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------- | - | ---- | ---------------------------- | ----
|Cash
                 Flows from Operating Activities:                                                                         
|Net
                 income                                                                                                     |  | $
                     3,479 |   |      | $ 
                    3,108 |     
|Adjustments to reconcile net income to net cash
                 provided by operating activities:                             
|Provision for credit
                 losses                                                                                    |  | 1,249                        |   |      | 1,408                        |     
|Depreciation and
                 amortization                                                                                  |  | 697                          |   |      | 680                          |     
|Equity securities
                 gains                                                                                        |  | (415                         | ) |      | (250                         | )   
|Investment
                 securities gains                                                                                    |  | (94                          | ) |      | (155                         | )   
|Net (increase)
                 decrease in trading assets                                                                      |  | (292                         | ) |      | (180                         | )   
|Net (increase)
                 decrease in net derivative product assets                                                       |  | (233                         | ) |      | 187                          |     
|Gain on sale of
                 banks and branch offices                                                                       |  | (348                         | ) |      | (343                         | )   
|Net (increase)
                 decrease in other assets                                                                        |  | 245                          |   |      | (2,290                       | )   
|Net increase
                 (decrease) in other liabilities                                                                   |  | (830                         | ) |      | (35                          | )   
|Merger-related and
                 restructuring charges                                                                       |  | 276                          |   |      | 1,026                        |     
|Other noncash
                 adjustments                                                                                      |  | (100                         | ) |      | 1,516                        |     
|                                                                                                                                |  |                              |   |      |                              |     
|Net
                 cash provided by operating activities                                                                      |  | 3,634                        |   |      | 4,672                        |     
|                                                                                                                               
|Cash
                 Flows from Investing Activities:                                                                         
|Net
                 (increase) decrease in federal funds sold and securities under
                 resale agreements          |  | 80                           |   |      | (695                         | )   
|Securities available for sale:                                                                                                
|Purchases                                                                                                                       |  | (56,564                      | ) |      | (27,077                      | )   
|Maturities                                                                                                                      |  | 16,150                       |   |      | 7,336                        |     
|Sales                                                                                                                           |  | 38,361                       |   |      | 18,543                       |     
|Securities held to maturity:                                                                                                  
|Purchases                                                                                                                       |  |                             |   |      |                             |     
|Maturities                                                                                                                      |  |                             |   |      | 104                          |     
|Credit
                 card receivables securitized                                                                            |  | 7,279                        |   |      | 10,323                       |     
|Net
                 (increase) in loans                                                                                        |  | (21,377                      | ) |      | (20,831                      | )   
|Loan
                 recoveries                                                                                                |  | 325                          |   |      | 447                          |     
|Additions to bank premises and equipment                                                                                        |  | (593                         | ) |      | (824                         | )   
|Net
                 cash and cash equivalents due to mergers, acquisitions and
                 dispositions                   |  | (1,669                       | ) |      | (2,337                       | )   
|All
                 other investing activities, net                                                                            |  | 41                           |   |      | (4,854                       | )   
|                                                                                                                                |  |                              |   |      |                              |     
|Net
                 cash (used in) investing activities                                                                        |  | (17,967                      | ) |      | (19,865                      | )   
|                                                                                                                               
|Cash
                 Flows from Financing Activities:                                                                         
|Net
                 increase in deposits                                                                                       |  | 3,907                        |   |      | 10,548                       |     
|Net
                 increase (decrease) in federal funds purchased and securities
                 under repurchase agreements |  | (4,444                       | ) |      | 2,819                        |     
|Net
                 increase (decrease) in other short-term borrowings                                                         |  | 4,274                        |   |      | 3,992                        |     
|Proceeds from issuance of long-term debt                                                                                        |  | 28,736                       |   |      | 19,062                       |     
|Repayment of long-term debt                                                                                                     |  | (16,245                      | ) |      | (18,062                      | )   
|Cash
                 dividends paid                                                                                            |  | (2,420                       | ) |      | (1,322                       | )   
|Proceeds from issuance of trust preferred capital
                 securities                                                   |  | 575                          |   |      |                             |     
|Proceeds from issuance of common and treasury
                 stock                                                            |  | 61                           |   |      | 161                          |     
|Purchase of treasury stock                                                                                                      |  | (1,647                       | ) |      | (375                         | )   
|Payment
                 for redemption of preferred stock                                                                      |  |                             |   |      |                             |     
|All
                 other financing activities, net                                                                            |  | (238                         | ) |      | (4                           | )   
|                                                                                                                                |  |                              |   |      |                              |     
|Net
                 cash provided by financing activities                                                                      |  | 12,559                       |   |      | 16,819                       |     
|                                                                                                                               
|Effect of Exchange Rate Changes on Cash and Cash
                 Equivalents                                                   |  | (25                          | ) |      | 604                          |     
|                                                                                                                               
|Net
                 Increase (Decrease) in Cash and Cash
                 Equivalents                                          |  | (1,799                       | ) |      | 2,230                        |     
|Cash
                 and Cash Equivalents at Beginning of Year                                                                 |  | 24,520                       |   |      | 22,290                       |     
|                                                                                                                                |  |                              |   |      |                              |     
|Cash
                 and Cash Equivalents at End of Year                                                                       |  | $
                   22,721  |   |      | $ 
                  24,520  |     
|                                                                                                                                |  |                              |   |      |                              |     
|Other Cash-Flow Disclosures:                                                                                                   
|Interest
                 paid                                                                                                  |  | $
                     8,082 |   |      | $ 
                    8,281 |     
|State and federal
                 income taxes paid                                                                            |  | 704                          |   |      | 680                          |     




The
               accompanying notes are an integral part of this
               statement.





NOTES TO
             CONSOLIDATED
             FINANCIAL
             STATEMENTS





BANK
               ONE CORPORATION and Subsidiaries





NOTE 1
               Summary of Significant Accounting Policies





Consolidated
               financial statements of the Corporation have been prepared in
               conformity with generally accepted accounting principles.
               Management is required to make estimates and assumptions that
               affect the amounts reported in the financial statements and
               accompanying notes that could differ from actual results.
               Certain prior-year financial statement information has been
               reclassified to conform with the current years financial
               statement presentation. Consolidated financial statements for
               all periods presented have been restated to include the results
               of operations, financial position and changes in cash flows for
               each acquisition accounted for as a pooling of interests.
               Adjustments have been made to conform accounting policies upon
               integration of each acquired entity.





(a)
                 Principles of Consolidation





The Corporation
               s consolidated financial statements include all accounts
               of the Corporation (the Parent Company) and all
               significant majority-owned subsidiaries. All significant
               intercompany accounts and transactions have been
               eliminated.





(b)
                 Trading Activities





Trading assets
               and liabilities are carried at fair value. Realized and
               unrealized gains and losses related to trading activities are
               included in noninterest income as trading profits.





Trading profits
               include interest rate, exchange rate, equity price and commodity
               price trading results from both cash and derivative financial
               instruments.





(c)
                 Investment Securities





Debt and equity
               investment securities classified as available for sale are
               carried at fair value. Fair value for venture capital
               investments that are publicly traded is estimated using quoted
               market prices adjusted for market liquidity and sale
               restrictions. Fair value for venture capital investments that
               are not publicly traded is estimated based on the investees
                financial results, conditions and prospects, values of
               comparable public companies, market liquidity and sales
               restrictions. Unrealized and realized gains and losses related
               to venture capital investments and realized gains and losses,
               including other than temporary impairments, on other
               available-for-sale equity securities are included in noninterest
               income as equity securities gains. Unrealized gains and losses,
               net of taxes, on all other available-for-sale securities are
               included in accumulated other adjustments to stockholders
               equity. Realized gains and losses, including other than
               temporary impairments, on held-to-maturity and
               available-for-sale investment debt securities are included in
               investment securities gains. The specific identification method
               is used to calculate realized gains or losses.





Debt securities
               classified as held to maturity are carried at cost. The interest
               method is used to amortize premiums or accrete
               discounts.





(d)
                 Loans





Loans typically
               are carried at cost. Unearned income includes deferred loan
               origination fees reduced by loan origination costs. Loans held
               for sale are carried at the lower of cost or fair value.
               Unrealized losses from loans held for sale and realized gains or
               losses resulting from loan sales typically are included in other
               income.





Loan origination
               and commitment fees typically are deferred and amortized over
               the life of the related loan. Loan origination fees and costs on
               credit card and other revolving loans are typically deferred and
               amortized into interest income using a straight-line method over
               one year. Other credit-related fees, such as syndication man
             agement fees, commercial letter of credit fees, and fees on
               unused, available lines of credit, are recorded as service
               charges and commissions as earned.





Loans, including
               lease financing receivables, are considered nonperforming when
               placed on nonaccrual status, or when renegotiated at terms that
               represent an economic concession to the borrower. Nonperforming
               loans are generally identified as impaired loans.





Management
               places a commercial loan on nonaccrual status when the
               collection of contractual principal or interest is deemed
               doubtful or it becomes 90 days or more past due and is not
               well-secured and in the process of collection. Accrued but
               uncollected interest is reversed and charged against interest
               income. Subsequently, the commercial loan is accounted for on a
               cash basis. Cash payments received are recognized either as
               interest income or as a reduction of principal when collection
               of principal is doubtful. A commercial loan is returned to
               accrual status only when all of the principal and interest
               amounts contractually due are reasonably assured of repayment
               within a reasonable time frame and when the borrower has
               demonstrated payment performance. Subsequently, the commercial
               loan is accounted for on an accrual basis.





A charge-off on
               a commercial loan is recorded in the reporting period in which
               either an event occurs that confirms the existence of a loss or
               it is determined that a loan or a portion of a loan is
               uncollectible.





Consumer loans
               are typically charged off rather than placed on nonaccrual
               status. The timing and amount of the charge-off will depend on
               the type of consumer loan, giving consideration to available
               collateral. A credit card loan is charged off after it becomes
               approximately 180 days past due or earlier in the event of
               bankruptcy notification. Other consumer loans have delinquency
               periods ranging from approximately 120180 days past due
               prior to charge-offs being recorded. In certain circumstances,
               charge-offs are recorded only after the Corporation obtains
               control of the underlying collateral, which could exceed 180
               days. Accrued but uncollected interest and fee revenue on a
               consumer loan generally is reversed against interest income and
               fee income when the loan is charged off.





In February
               1999, the FFIEC published a revised policy statement on the
               classification of consumer loans. The revised policy establishes
               uniform guidelines for the charge-off of loans to delinquent,
               bankrupt and deceased borrowers, for charge-off of fraudulent
               accounts and for re-aging, extending, deferring or rewriting
               delinquent accounts. In December 1999, the Corporation changed
               its charge-off policy for bankruptcy and fraudulent account
               charge-offs, as well as delinquent account charge-offs for
               certain portfolios.





Specifically,
               unless the Corporation can clearly demonstrate and document that
               repayment on an account in bankruptcy is likely to occur, an
               account in bankruptcy is now charged off within 60 days of
               receipt of notification of filing from the bankruptcy court.
               Fraudulent loans are now charged off within 90 days of
               discovery, rather than 150 days, which was the Corporation
               s policy prior to December 1999. Closed-end consumer loans
               such as auto loans and leases, and home mortgage loans, are
               typically charged-off upon reaching four months or 120
               cumulative days contractually past due.





The Corporation
               plans to adopt the remaining provisions of the revised policy by
               the fourth quarter of 2000, as required by the FFIEC. The effect
               of adopting the remaining policy revisions is currently under
               review.





Interest income
               typically accrues on a consumer loan until it is charged off.
               The amount of accrued interest income is reversed and charged
               against interest income at the time of charge-off. Real estate
               mortgages and home equity loans are exceptions to this process.
               Interest income reversals on these loans occur after such loans
               become 90 days or more past due.





An economic
               concession on a renegotiated loan may represent forgiveness of
               principal and/or interest or a below-market interest rate
               offered to the borrower to maximize recovery of the loan.
               Generally, this occurs when the borrowers cash flow is
               insufficient to service the loan under its original terms.
               Subject to the above nonaccrual policy, interest on these loans
               is accrued at the reduced rates.





(e)
                 Allowance for Credit Losses





Management
               maintains the allowance for credit losses at a level it believes
               is adequate to provide for estimated probable credit losses
               inherent in on- and off-balance sheet credit exposure. The
               allowance for credit losses attributable to off-balance sheet
               credit exposure is not material. For a more detailed discussion,
               see Allocated Reserves and Unallocated Reserves
                under the Allowance for Credit Losses section
               on pages 28 and 29.





(f)
                 Loan Securitizations





For a discussion
               of the Corporations accounting policies for loan
               securitizations, see the Loan Securitizations
               section, beginning on page 32.





(g)
                 Mortgage Banking Activities





Mortgage
               servicing assets are not significant at December 31, 1999, since
               the Corporation has transferred the majority of such servicing
               rights to a third party. Mortgage servicing assets are recorded
               in other assets. In prior years, mortgage servicing rights were
               acquired through purchase, or originated and then retained after
               the underlying mortgage loans were transferred through sale or
               securitization. Mortgage servicing assets were amortized into
               service charges and commissions in proportion to, and over the
               period of, the estimated net servicing income on the underlying
               mortgage loans or securities. Mortgage servicing assets were
               stratified by both product type and interest rate range for
               purposes of evaluating and measuring impairment based on their
               fair values. Any impairments resulting from declines in fair
               value were included in service charges and
               commissions.





(h)
                 Other Real Estate Owned





Other real
               estate owned includes assets that have been received in
               satisfaction of debt. Other real estate owned is initially
               recorded and subsequently carried at the lower of cost or fair
               value less estimated selling costs. Any valuation adjustments
               required at the date of transfer are charged to the allowance
               for credit losses. Subsequently, unrealized losses and realized
               gains and losses on sale typically are included in other income.
               Operating results from other real estate are recorded in other
               noninterest expense.





(i)
                 Intangible Assets





Intangible
               assets include goodwill resulting from acquisitions accounted
               for by the purchase method and identifiable intangible assets,
               such as customer lists, core deposits and credit card
               relationships. Goodwill is equal to an acquired companys
               acquisition cost less the net fair value amount assigned to
               identifiable assets acquired and liabilities
               assumed.





Intangible
               assets are reported in other assets and are amortized into other
               noninterest expense on an accelerated or straight-line basis
               over the period the Corporation expects to benefit from such
               assets. Goodwill is amortized over estimated periods ranging
               from five to 40 years. Refer to Note 4 on page 47, for further
               details. Intangible assets are periodically reviewed for
               impairment.





(j)
                 Derivative Financial Instruments





For a discussion
               of the Corporations accounting policies for derivative
               financial instruments, see the Derivative Financial
               Instruments section, beginning on page 30.





(k)
                 Foreign Currency Translation





If a foreign
               installations functional currency is the U.S. dollar, then
               its local currency financial statements are remeasured to U.S.
               dollars. Remeasurement effects and the results of related
               hedging transactions are included in other income.





If a foreign
               installations functional currency is its local currency,
               then its local currency financial statements are translated into
               U.S. dollars. Translation adjustments, related hedging results
               and applicable income taxes are included in accumulated other
               adjustments to stockholders equity.





(l)
                 Income Taxes





Deferred tax
               assets and liabilities are determined based on temporary
               differences between financial reporting and tax basis of assets
               and liabilities and are measured using the enacted tax rates and
               laws that will be in effect when the differences are expected to
               reverse. The effect on deferred tax assets and liabilities of a
               change in rates is recognized as income or expense in the period
               that includes the enactment date.





(m)
                 Cash Flow Reporting





The Corporation
               uses the indirect method, which reports cash flows from
               operating activities by adjusting net income to reconcile to net
               cash flows from operating activities. Cash and cash equivalents
               consist of cash and due from banks, whether interest-bearing or
               not. Net reporting of cash transactions has been used when the
               balance sheet items consist predominantly of maturities of three
               months or less, or where otherwise permitted. Other items are
               reported on a gross basis.





(n)
                 Stock-Based Compensation





In accordance
               with the Statement of Financial Accounting Standards (SFAS
               ) No. 123, Accounting for Stock-Based Compensation,
                there are no charges to earnings associated with stock
               options granted or with the Employee Stock Purchase Plan offered
               by the Corporation. Compensation expense related to restricted
               stock awards is recorded over the period the shares remain
               restricted. Information on the Corporations stock-based
               compensation plans and disclosure of the pro forma effect of
               applying the fair value method contained in SFAS No. 123 is
               included in Note 17, beginning on page 61.





(o)
                 New Accounting Pronouncements





In June 1998,
               the Financial Accounting Standards Board (FASB)
               issued SFAS No. 133, Accounting for Derivative Instruments
               and Hedging Activities. This Statement establishes new
               accounting and reporting standards for derivative instruments
               and hedging activities. It requires that an entity recognize all
               derivatives as either assets or liabilities on the balance sheet
               and measure those derivatives at fair value. The accounting for
               the gains or losses resulting from changes in the value of those
               derivatives will depend on the intended use of the derivative
               and whether it qualifies for hedge accounting. This Statement
               will significantly change the accounting treatment for interest
               rate and foreign exchange derivatives the Corporation uses in
               its asset and liability management activities. The transition
               adjustments resulting from adopting this Statement will be
               reported in net income or accumulated other adjustments to
               stockholders equity, as appropriate, as the effect of a
               change in accounting principle and presented in a manner similar
               to the cumulative effect of a change in accounting principle.
               The Corporation was originally to adopt this Statement on
               January 1, 2000. In June 1999, the FASB issued SFAS No. 137,
               Accounting for Derivative Instruments and Hedging
               ActivitiesDeferral of the Effective Date of FASB Statement
               No. 133. SFAS No. 137 is an amendment of SFAS No. 133 that
               delays the effective date of this Statement to fiscal years
               beginning after June 15, 2000 (calendar year 2001 for the
               Corporation). The Corporation and a large number of other
               derivative users had requested such a delay, primarily due to a
               number of key interpretative issues that have not been resolved,
               as well as Year 2000 systems considerations. Although
               considerable progress has been made in preparing for this
               Statement, interpretative guidance continues to be issued by the
               FASB that significantly affects certain hedging activities. In
               December 1999, the FASB announced that consideration was being
               given to a limited-scope project that might result in either an
               amendment of SFAS No. 133 or modifications in previous FASB
               conclusions. As a result, the Corporation is developing and
               implementing strategies to adopt the Statement for those hedging
               activities for which no further FASB interpretative guidance is
               expected. For all other hedging activities, contingency plans
               are being developed and FASB actions are being closely monitored
               for indications of final rulings. At this point, the Corporation
               is in the process of
             estimating the effect, if any, that the adoption of this new
               standard will have on the Corporations financial position
               or results of operations.





NOTE 2
               Earnings Per Share





In 1997, the
               Corporation adopted SFAS No. 128, Earnings Per Share.
                The Statement replaces primary earnings per share (
               EPS) with earnings per common share (Basic EPS
               ). Basic EPS is computed by dividing income available to
               common stockholders by the average number of common shares
               outstanding for the period.





The Statement
               also requires presentation of EPS assuming dilution. The diluted
               EPS calculation includes shares that could be issued under
               outstanding stock options and the employee stock purchase plans,
               and common shares that would result from the conversion of
               convertible preferred stock and convertible debentures. In the
               diluted calculation, net income is not reduced by dividends
               related to convertible preferred stock, since such dividends
               would not be paid if the preferred stock were converted to
               common stock. In addition, interest on convertible debentures
               (net of tax) is added to net income, since this interest would
               not be paid if the debentures were converted to common
               stock.





|(In
                  millions, except per share data)                                        |  | 1999                      |   | 1998 |                           | 1997
|--------------------------------------------------------------------------------------------- |  | ------------------------- | - | ---- | ------------------------- | ----
|Basic:                                                                                       
|Net
                 income                                                                   |  | $3,479                    |   |      | $3,108                    |     
|Preferred stock dividends                                                                     |  | (12                       | ) |      | (14                       | )   
|                                                                                              |  |                           |   |      |                           |     
|Net
                 income attributable to common stockholders
                 equity      |  | $3,467                    |   |      | $3,094                    |     
|                                                                                              |  |                           |   |      |                           |     
|Diluted:                                                                                     
|Net
                 income                                                                   |  | $3,479                    |   |      | $3,108                    |     
|Interest
                 on convertible debentures, net of tax                               |  | 6                         |   |      | 7                         |     
|Preferred stock dividends excluding dividends on
                 convertible preferred stock |  | (12                       | ) |      | (12                       | )   
|                                                                                              |  |                           |   |      |                           |     
|Diluted
                 income available to common stockholders                              |  | $3,473                    |   |      | $3,103                    |     
|                                                                                              |  |                           |   |      |                           |     
|Average
                 shares outstanding                                                   |  | 1,168                     |   |      | 1,170                     |     
|Dilutive shares:                                                                             
|Stock
                 options                                                                |  | 6                         |   |      | 12                        |     
|Convertible preferred stock                                                                   |  |                          |   |      | 1                         |     
|Convertible debentures                                                                        |  | 4                         |   |      | 4                         |     
|Employee
                 stock purchase plans                                                |  |                          |   |      | 2                         |     
|                                                                                              |  |                           |   |      |                           |     
|Average
                 shares outstanding, assuming full dilution                           |  | 1,178                     |   |      | 1,189                     |     
|                                                                                              |  |                           |   |      |                           |     
|Earnings per share:                                                                          
|Basic                                                                                         |  | $
                   2.97 |   |      | $ 
                  2.65 |     
|                                                                                              |  |                           |   |      |                           |     
|Diluted                                                                                       |  | $
                   2.95 |   |      | $ 
                  2.61 |     
|                                                                                              |  |                           |   |      |                           |     




NOTE 3
               Banc One/FCN Merger





On October 2,
               1998, Banc One and FCN were each merged into the Corporation, at
               that time a wholly owned subsidiary of Banc One formed in 1998
               to effect the Merger. Each share of Banc One common stock was
               converted into one share of the Corporations common stock.
               Each share of FCN common stock was converted into the right to
               receive 1.62 shares of the Corporations common stock. In
               aggregate, 291 million shares of FCN were converted into 471
               million shares of the Corporations common stock. Each
               share of preferred stock of FCN outstanding immediately prior to
               the Merger was converted into one share of a series of
               corresponding preferred stock of the Corporation with
               substantially the same terms. The transaction was accounted for
               as a pooling of interests.





Previously
               reported financial information for Banc One and FCN is shown in
               the table below.





|(In
                  millions) |  | 1997                      
|------------------------------- |  | --------------------------
|Revenue                        
|Banc
                 One       |  | $13,219                   
|FCN                             |  | 10,098                    
|                               
|Net
                 Income    
|Banc
                 One       |  | $ 
                  1,306
|FCN                             |  | 1,525                     




To conform with
               consistent methods of accounting, reclassifications of certain
               revenue and expense items were made. In addition, the accounting
               treatment for the postretirement transition obligation
               identified with the implementation of SFAS No. 106,
               Employers Accounting for Postretirement Benefits
               Other Than Pensions, has been conformed.





NOTE 4
               Acquisitions





On September 30,
               1998, the Corporation purchased the credit card operation of
               Chevy Chase Bank, FSB. The portfolio included $4.8 billion in
               managed credit card loans and 2.8 million Visa® and Master
               Card® credit card accounts. At the purchase date, a credit
               card account premium of $291 million was recognized on the
               balance sheet and is being amortized over seven years using the
               straight-line method.





On June 12,
               1998, the Corporation completed its acquisition of First
               Commerce Corporation (First Commerce) located in New
               Orleans, Louisiana, resulting in the issuance of approximately
               56 million shares of the Corporations common stock valued
               at $3.5 billion for all the outstanding shares of First Commerce
               common stock, in a tax-free exchange. Each share of First
               Commerce common stock was exchanged for 1.408 shares of the
               Corporations common stock. First Commerce was a multi-bank
               holding company with total assets of approximately $9.3 billion
               and stockholders equity of approximately $805 million at
               June 12, 1998. The acquisition was accounted for as a pooling of
               interests.





NOTE 5
               Merger-Related and Restructuring Charges





a)
                 Fourth Quarter 1999 Restructuring
               Charge





Restructuring
               costs recorded in the fourth quarter of 1999 totaled $207
               million ($141 million after-tax) or 12 cents per share. The
               following table provides detail on restructuring charges
               recorded.





|(In
                 millions)          |  | 1999
                  Expense
|--------------------------------------- |  | ------------------------------
|Personnel-related costs                 |  | $143                          
|Fixed
                 asset write-offs |  | 24                            
|Contractual obligations                 |  | 40                            
|                                        |  |                               
|                                        |  | $207                          
|                                        |  |                               




Personnel-related items consist primarily of severance and
               benefits costs for separated employees and executives due to
               delayering and management realignment. The net reduction in
               full-time equivalent positions is anticipated to approximate
               5,100. Other charges include identified asset write-offs and the
               termination costs associated with lease and other vendor
               contracts.





b)
                 Banc One/FCN Merger





The Corporation
               has incurred net restructuring charges and merger-related costs
               of approximately $1.25 billion ($837 million after-tax) as of
               December 31, 1999, in connection with the Merger. Merger-related
               costs
             totaled $515 million ($347 million after-tax), or 29 cents per
               share, for the full year of 1999. Gains on the required Indiana
               banking center divestitures totaled approximately $249 million
               in the first quarter of 1999. Merger-related and restructuring
               costs recorded in the fourth quarter of 1998 totaled $984
               million, consisting of a restructuring charge of $636 million
               and merger-related costs of $348 million.





In 1999
               merger-related costs of $515 million included $337 million
               related to the accounting consequences of changes in business
               practices. Of this total, $196 million resulted from the
               fourth-quarter 1998 modification, in light of the Merger, of a
               contractual relationship to purchase credit card accounts.
               Previously capitalized costs under this account-sourcing
               agreement were amortized over a one-year period. Beginning in
               the fourth quarter of 1998, these costs were expensed as
               incurred. Merger-related costs also included $250 million of
               business and systems integration costs. These charges are
               partially offset by the reversal in the third quarter of 1999 of
               $42 million in initially established severance accruals. The
               reserve release was based on higher than anticipated staff
               attrition in certain business units. In addition, a reversal of
               $30 million of initially established reserves related to certain
               asset dispositions was recorded in the fourth quarter of 1999.
               The reserves were released based on decision changes regarding
               asset usage and negotiations of more favorable contract
               termination fees.





Personnel-related items consisted primarily of severance
               and benefits costs for separated employees, and costs associated
               with the change in control provisions included in
               certain of the Corporations stock plans. Facilities and
               equipment costs include the net cost associated with the closing
               and divestiture of identified banking facilities, and the
               consolidation of headquarters and operational facilities. Other
               merger-related transaction costs included investment banking
               fees, registration and listing fees, and various accounting,
               legal and other related transaction costs.





The following
               table provides details on restructuring charges recorded in
               connection with the Merger.





|(In
                  millions)          |  | Restructuring
               
               Charges |  | Initial
               
               Reserve |  | Reserve
               
               Balance
               
               12/31/98 |  | 1999
               
               Amount
               
               Utilized |  | 1999
               
               Amount
               
               Released |  | Reserve
               
               Balance
               
               12/31/99
|---------------------------------------- |  | ---------------------------------------------------- |  | ---------------------------------------------- |  | -------------------------------------------------------------------------------------- |  | ---------------------------------------------------------------------------------- |  | ---------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------
|Personnel-related                        |  | $421                                                 |  | $421                                           |  | $307                                                                                   |  | $192                                                                               |  | $42                                                                                |  | $73                                                                                   
|Facilities and equipment                 |  | 135                                                  |  | 135                                            |  | 30                                                                                     |  |                                                                                   |  | 30                                                                                 |  |                                                                                      
|Other
                 transaction costs |  | 80                                                   |  |                                               |  |                                                                                       |  |                                                                                   |  |                                                                                   |  |                                                                                      
|                                         |  |                                                      |  |                                                |  |                                                                                        |  |                                                                                    |  |                                                                                    |  |                                                                                       
|Total                                    |  | $636                                                 |  | $556                                           |  | $337                                                                                   |  | $192                                                                               |  | $72                                                                                |  | $73                                                                                   
|                                         |  |                                                      |  |                                                |  |                                                                                        |  |                                                                                    |  |                                                                                    |  |                                                                                       




c)
                 First Commerce Acquisition





In connection
               with the First Commerce acquisition, the Corporation identified
               restructuring and merger integration charges of $182 million
               ($127 million after-tax), of which $127 million was recorded as
               a restructuring charge, $44 million represented integration
               costs and $11 million was associated with Year 2000 compliance.
               The restructuring charge of $127 million relating to the First
               Commerce acquisition consisted of employee benefits and
               severance costs as well as identified occupancy, equipment and
               transaction costs.





The following
               table provides details on merger-related and restructuring
               charges recorded in 1999 in connection with the First Commerce
               acquisition.





|(In
                 millions)               |  | 1998
               
               Initial Reserve |  | Reserve Balance
               
               December 31, 1998 |  | 1999
               
               Amount Utilized
|-------------------------------------------- |  | --------------------------------------------------- |  | ---------------------------------------------------------------- |  | ---------------------------------------------------
|Personnel-related                            |  | $ 
                  77                             |  | $10                                                              |  | $10                                                
|Facilities and equipment                     |  | 32                                                  |  | 19                                                               |  | 19                                                 
|Other                                        |  | 18                                                  |  | 3                                                                |  | 3                                                  
|                                             |  |                                                     |  |                                                                  |  |                                                    
|Total
                 restructuring charges |  | $127                                                |  | $32                                                              |  | $32                                                
|                                             |  |                                                     |  |                                                                  |  |                                                    




This reserve was
               fully utilized at December 31, 1999.





d)
                 First USA Acquisition





On June 27,
               1997, Banc One completed its acquisition of First USA. In
               connection with the First USA acquisition, the Corporation
               recognized second quarter 1997 merger-related costs and
               restructuring charges of $371 million ($261 million after-tax),
               or 21 cents per share, of which $241 million was recorded as a
               separate component of noninterest expense and $130 million was
               recorded as additional provision for credit losses.





The
               restructuring charge associated with the First USA acquisition
               totaled $241 million and consisted of employee benefits,
               severance and stock option vesting costs; professional services
               costs; premiums to redeem preferred securities of a subsidiary
               trust; asset-related write-downs and other merger-related
               costs.





The $130 million
               additional provision for credit losses primarily reflects the
               reclassification of $2 billion of credit card loans previously
               classified as held for sale to the loan and lease portfolio in
               connection with the effort to consolidate the Banc One and First
               USA credit card master trusts, as well as an additional
               provision to conform credit card charge-off
               policies.





This reserve had
               been fully utilized at December 31, 1998.





NOTE 6
               Operating Segments





See the
               following Business Segments sections for additional
               disclosure regarding the Corporations operating
               segments:





| | · | Highlights on page 3.
| | - | -----------------------




| | · | Business Segment Management on page 3.
| | - | ----------------------------------------




| | · | Tables
                 included in the Business Segments section
                 beginning with Commercial Banking through
                 Corporate/Unallocated on pages 48 and the
                 Line of Business Reorganization table on page
                 9.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




Operating
               segments disclosures are presented for 1999 and 1998. Due to the
               Banc One/FCN Merger, segment results for prior years are not
               available. The information presented is consistent with the
               content of operating segments data provided to the Corporation
               s executive management. The Corporations executive
               management currently does not use product group revenues to
               assess consolidated results. Aside from investment management
               and insurance products, product offerings are tailored to
               specific customer segments. As a result, the aggregation of
               product revenues and related profit measures across lines of
               business is not available.





Aside from the
               United States, no single country or geographic region generates
               a significant portion of the Corporations revenues or
               assets. In addition, there are no single customer concentrations
               of revenue or profitability.





NOTE 7
               Investment Securities





The amortized
               cost and estimated fair value of available-for-sale securities
               and the related unrealized gains and losses were as
               follows:





|                                                               |  | Investment SecuritiesAvailable for
                 Sale
|-------------------------------------------------------------- |  | ---------------------------------------------------------
|
|U.S.
                 Treasury                                 |  | $
                   2,569                               
|U.S.
                 government agencies                      |  | 12,919                                                   
|States
                 and political subdivisions             |  | 1,599                                                    
|Retained interests in securitized
                 receivables |  | 20,507                                                   
|Other
                 debt securities                         |  | 7,473                                                    
|Equity
                 securities (1)(2)                      |  | 3,238                                                    
|                                                               |  |                                                          
|Total                                                          |  | $48,305                                                  
|                                                               |  |                                                          
|
|
|U.S.
                 Treasury                                 |  | $ 
                  4,496                               
|U.S.
                 government agencies                      |  | 10,469                                                   
|States
                 and political subdivisions             |  | 1,980                                                    
|Retained interests in securitized
                 receivables |  | 17,544                                                   
|Other
                 debt securities                         |  | 8,174                                                    
|Equity
                 securities (1)(2)                      |  | 2,094                                                    
|                                                               |  |                                                          
|Total                                                          |  | $44,757                                                  
|                                                               |  |                                                          




|(1) | The
                 fair values of certain securities for which market quotations
                 were not available were estimated. In addition, the fair
                 values of certain securities reflect liquidity and other
                 market-related factors.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Includes investments accounted for at fair value, in
                 keeping with specialized industry practice.
|--- | -----------------------------------------------------------------------------------------------------------------




The maturity
               distribution of debt investment securities is shown below. The
               distribution of mortgage-backed securities and collateralized
               mortgage obligations is based on average expected maturities.
               Actual maturities might differ because issuers may have the
               right to call or prepay obligations.





|December 31, 1999 (In
                  millions)       |  | Amortized Cost |  | Fair
                  Value
|------------------------------------------------------- |  | -------------- |  | ----------------------------
|Due in
                 one year or less                |  | $24,506        |  | $24,568                     
|Due
                 after one year through five years  |  | 10,722         |  | 10,553                      
|Due
                 after five years through ten years |  | 3,576          |  | 3,392                       
|Due
                 after ten years                    |  | 6,263          |  | 5,946                       
|                                                        |  |                |  |                             
|Total                                                   |  | $45,067        |  | $44,459                     
|                                                        |  |                |  |                             




During 1999, the
               Corporation transferred $2.3 billion of securities from
               available for sale to trading assets, resulting in a loss of $4
               million. This transfer was for capital management purposes, and
               reflects the Corporations intent to sell these assets in
               the short-term.





In connection
               with the Banc One/FCN Merger, a $656 million transfer was made
               in 1998 to reclassify debt investment securities from held to
               maturity to available for sale to maintain an interest rate risk
               position that existed prior to the business
               combination.





During 1998, the
               Corporation reclassified $9.5 billion from loans and $468
               million from other assets to investment securities
               available for sale. The amounts transferred represent the
               Corporations retained interest in its securitized credit
               card receivables.





NOTE 8
               Loans





|December 31 (In
                  millions)        |  | 1999                        |  | 1998                       
|-------------------------------------------------- |  | --------------------------- |  | ---------------------------
|Commercial                                        
|Domestic                                          
|Commercial                                         |  | $
                   55,661 |  | $ 
                  53,362
|Real
                 estate                      
|Construction                                       |  | 5,836                       |  | 5,108                      
|Other                                              |  | 18,817                      |  | 17,787                     
|Lease
                 financing                   |  | 8,971                       |  | 6,236                      
|Foreign                                            |  | 7,067                       |  | 5,945                      
|                                                   |  |                             |  |                            
|Total
                 commercial                  |  | 96,352                      |  | 88,438                     
|Consumer                                          
|Residential real estate                            |  | 32,313                      |  | 25,804                     
|Automotive                                         |  | 23,567                      |  | 20,634                     
|Other                                              |  | 7,608                       |  | 11,488                     
|                                                   |  |                             |  |                            
|Total
                 consumer                    |  | 63,488                      |  | 57,926                     
|Credit
                 card                       |  | 4,037                       |  | 9,034                      
|                                                   |  |                             |  |                            
|Total
                 loans                       |  | 163,877                     |  | 155,398                    
|Less:
                 Allowance for credit losses |  | 2,285                       |  | 2,271                      
|                                                   |  |                             |  |                            
|Total
                 loans, net                  |  | $161,592                    |  | $153,127                   
|                                                   |  |                             |  |                            




Loans held for
               sale totaled $3.0 billion at December 31, 1999, and $5.4 billion
               at December 31, 1998.





The Corporation
               s primary goal in managing credit risk is to minimize the
               impact of default by an individual borrower or group of
               borrowers. As a result, the Corporation strives to maintain a
               loan portfolio that is diverse in terms of loan type, industry,
               borrower and geographic concentrations. As of December 31, 1999
               and 1998, there were no significant loan concentrations with any
               single borrower, industry or geographic segment.





The Corporation
               s impaired loan information is outlined in the tables
               below. A loan is considered impaired when it is probable that
               all principal and interest amounts due will not be collected in
               accordance with the loans contractual terms. Certain
               loans, such as loans carried at the lower of cost or fair value
               or small-balance homogeneous loans (e.g., credit card and
               installment credit) are exempt from impairment determinations
               for disclosure purposes. Impairment is recognized to the extent
               that the recorded investment of an impaired loan or pool of
               loans exceeds its value either based on the loans
               underlying collateral or the calculated present value of
               projected cash flows discounted at the contractual interest
               rate. Loans having a significant recorded investment are
               measured on an individual basis, while loans not having a
               significant recorded investment are grouped and measured on a
               pool basis.





|December 31 (In
                  millions)  |  | 1999                     |  | 1998
|-------------------------------------------- |  | ------------------------ |  | ----
|Impaired loans with related allowance        |  | $1,026                   |  | $471
|Impaired loans with no related allowance (1) |  | 27                       |  | 258 
|                                             |  |                          |  |     
|Total
                 impaired loans        |  | $1,053                   |  | $729
|                                             |  |                          |  |     
|Allowance on impaired loans (2)              |  | $
                   246 |  | $112
|                                             |  |                          |  |     




|(1) | Impaired loans for which the discounted cash flows,
                 collateral value or market price equals or exceeds the
                 carrying value of the loan do not require an allowance under
                 SFAS No. 114.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|(2) | The
                 allowance for impaired loans is included in the Corporation
                 s overall allowance for credit losses.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------




|(In
                  millions)                    |  | 1999 |  | 1998 |  | 1997
|-------------------------------------------------- |  | ---- |  | ---- |  | ----
|Average
                 balance of impaired loans |  | $972 |  | $638 |  | $534
|Interest income recognized on impaired loans       |  | 46   |  | 38   |  | 29  




NOTE 9
               Allowance for Credit Losses





Changes in the
               allowance for credit losses for the three years ended December
               31, 1999, were as follows:





|(In
                  millions)  |  | 1999                       |   | 1998 |                            | 1997
|-------------------------------- |  | -------------------------- | - | ---- | -------------------------- | ----
|Balance, beginning of year       |  | $
                   2,271 |   |      | $ 
                  2,817 |     
|Additions (deductions)           |  |                            |   |      |                            |     
|Charge-offs                      |  | (1,531                     | ) |      | (1,945                     | )   
|Recoveries                       |  | 325                        |   |      | 447                        |     
|                                 |  |                            |   |      |                            |     
|Net
                 charge-offs |  | (1,206                     | ) |      | (1,498                     | )   
|Provision for credit losses      |  | 1,249                      |   |      | 1,408                      |     
|Other                            |  | (29                        | ) |      | (456                       | )   
|                                 |  |                            |   |      |                            |     
|Balance, end of year             |  | $
                   2,285 |   |      | $ 
                  2,271 |     
|                                 |  |                            |   |      |                            |     




The composition
               of the 1999 and 1998 other adjustments to the allowance for
               credit losses is addressed in the two paragraphs immediately
               following the table titled Analysis of Allowance for
               Credit Losses, beginning on page 27.





NOTE 10
               Long-Term Debt





Long-term debt
               consists of borrowings having an original maturity of greater
               than one year. Original issue discount and deferred issuance
               costs are amortized into interest expense over the terms of the
               related notes. Long-term debt at December 31, 1999 and 1998, was
               as follows:


|(Dollars in millions)                                                          |  | Effective
               
               Rate (1) |   | 1999 |                            | 1998
|------------------------------------------------------------------------------ |  | ------------------------------------------------- | - | ---- | -------------------------- | ----
|Parent Company                                                                 |  |                                                   |   |      |                            |     
|Subordinated debt                                                              |  |                                                   |   |      |                            |     
|9% notes
                 due 1999                                             |  |                                                  | % |      | $
                        |     
|97/8% notes
                 due 2000                                          |  | 10.07                                             |   |      | 100                        |     
|91/5% notes
                 due 2001                                          |  | 9.20                                              |   |      | 5                          |     
|91/4% notes
                 due 2001                                          |  | 9.27                                              |   |      | 100                        |     
|101/4% notes
                 due 2001                                         |  | 10.31                                             |   |      | 100                        |     
|111/4% notes
                 due 2001                                         |  | 9.26                                              |   |      | 99                         |     
|71/4% notes
                 due 2002 (2)                                      |  | 7.34                                              |   |      | 348                        |     
|87/8% notes
                 due 2002                                          |  | 7.40                                              |   |      | 104                        |     
|81/10% notes
                 due 2002                                         |  | 7.19                                              |   |      | 205                        |     
|81/4% notes
                 due 2002                                          |  | 7.04                                              |   |      | 104                        |     
|8.74%
                 notes due 2003 (2)                                      |  | 8.74                                              |   |      | 170                        |     
|75/8% notes
                 due 2003                                          |  | 7.67                                              |   |      | 200                        |     
|67/8% notes
                 due 2003                                          |  | 6.90                                              |   |      | 200                        |     
|Floating
                 rate notes due 2003 (3)                              |  | 6.38                                              |   |      | 150                        |     
|71/4%
                 debentures due 2004                                     |  | 7.27                                              |   |      | 200                        |     
|Floating
                 rate notes due 2005 (3)                              |  | 6.43                                              |   |      | 96                         |     
|7% notes
                 due 2005                                             |  | 7.06                                              |   |      | 297                        |     
|61/8% notes
                 due 2006                                          |  | 6.23                                              |   |      | 149                        |     
|7% notes
                 due 2006                                             |  | 7.06                                              |   |      | 149                        |     
|71/8% notes
                 due 2007                                          |  | 7.16                                              |   |      | 199                        |     
|76/10% notes
                 due 2007 (2)                                     |  | 8.67                                              |   |      | 398                        |     
|6% notes
                 due 2009                                             |  | 6.26                                              |   |      | 349                        |     
|63/8% notes
                 due 2009                                          |  | 6.36                                              |   |      | 200                        |     
|97/8% notes
                 due 2009 (2)                                      |  | 9.96                                              |   |      | 53                         |     
|10%
                 notes due 2010                                            |  | 10.06                                             |   |      | 198                        |     
|99/10% notes
                 due 2019                                         |  | 9.91                                              |   |      | 143                        |     
|71/2%
                 preferred purchase units due 2023                       |  |                                                  |   |      |                           |     
|73/4% notes
                 due 2025 (2)                                      |  | 9.39                                              |   |      | 294                        |     
|75/8% notes
                 due 2026 (2)                                      |  | 8.36                                              |   |      | 492                        |     
|8% notes
                 due 2027 (2)                                         |  | 9.24                                              |   |      | 490                        |     
|97/8%
                 equity commitment notes due 1999                        |  |                                                  |   |      |                           |     
|Convertible debentures 123/4%
                 Series A                        |  | 12.75                                             |   |      | 19                         |     
|Convertible debentures 123/4%
                 Series B                        |  | 12.75                                             |   |      | 46                         |     
|Senior debt                                                                    |  |                                                   |   |      |                            |     
|Medium-term notes                                                              |  | 6.31                                              |   |      | 14,445                     |     
|Other                                                                          |  |                                                  |   |      | 9                          |     
|                                                                               |  |                                                   |   |      |                            |     
|Total
                 Parent Company                                          |  |                                                   |   |      | 20,111                     |     
|Subsidiaries                                                                   |  |                                                   |   |      |                            |     
|Bank
                 notes, various rates and maturities                      |  | 6.27                                              |   |      | 11,279                     |     
|Subordinated 73/8% notes
                 due 2002                             |  | 7.87                                              |   |      | 148                        |     
|Subordinated 61/4% notes
                 due 2003                             |  | 6.25                                              |   |      | 200                        |     
|Subordinated 65/8%-7.65%
                 notes due 2003                       |  | 6.81-7.78                                         |   |      | 452                        |     
|Subordinated 6% notes due 2005                                                 |  | 6.28                                              |   |      | 148                        |     
|Subordinated 61/4% notes
                 due 2008                             |  | 6.30                                              |   |      | 496                        |     
|Subordinated 81/4% notes
                 due 2024                             |  | 7.72                                              |   |      | 254                        |     
|Capitalized lease and others, at various rates and
                 maturities |  | various                                           |   |      | 769                        |     
|                                                                               |  |                                                   |   |      |                            |     
|Total
                 subsidiaries                                            |  |                                                   |   |      | 13,746                     |     
|                                                                               |  |                                                   |   |      |                            |     
|Total
                 long-term debt                                          |  |                                                   |   |      | $33,857                    |     
|                                                                               |  |                                                   |   |      |                            |     




|(1) | The
                 effective rate includes amortization of premium or discount.
                 Interest rate swap agreements have been entered into that have
                 altered the stated interest rate for certain of the borrowings
                 to variable interest rates. The effective rates include the
                 impact of these swap agreements at December 31, 1999. The
                 terms to maturity of the swaps are equal to those of the
                 altered borrowings.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | The
                 notes are not subject to redemption and impose certain
                 limitations relating to funded debt, liens and the sale or
                 issuance of capital stock of significant bank
                 subsidiaries.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | The
                 floating rate notes due in 2003 have an interest rate priced
                 at the greater of 41/4% or
                 the three-month LIBOR plus1/8%. The
                 floating rate notes due in 2005 have an interest rate of the
                 greater of 51/4% or
                 the three-month LIBOR rate plus1/4%.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




Aggregate
               annual repayments of long-term debt at December 31,
               1999:





|(In
                  millions) |  | Total                     
|------------------------------- |  | --------------------------
|2000                            |  | $ 
                  8,753
|2001                            |  | 8,441                     
|2002                            |  | 5,167                     
|2003                            |  | 1,868                     
|2004                            |  | 3,490                     
|Thereafter                      |  | 6,138                     
|                                |  |                           
|Total                           |  | $33,857                   
|                                |  |                           




NOTE 11
               Guaranteed Preferred Beneficial Interest in the Corporation
               s Junior Subordinated Debt





The $1.578
               billion of Guaranteed Preferred Beneficial Interest in the
               Corporations Junior Subordinated Debt (Trust
               Preferred Capital Securities) represents the net proceeds
               from the issuance of preferred capital securities by First
               Chicago NBD Institutional Capital A (the Series A Trust
               ), First Chicago NBD Institutional Capital B (the
               Series B Trust), First Chicago NBD Capital I (the
               Series I Trust), First USA Capital Trust I (the
               First USA Trust) and BANK ONE Capital I (the
               Bank One Trust). Each of the trusts is a statutory
               business trust organized for the sole purpose of issuing capital
               securities and investing the proceeds thereof in junior
               subordinated debentures of the Corporation (Junior
               Subordinated Debt). The preferred capital securities
               represent preferred individual beneficial interests in the
               respective trusts and are subject to mandatory redemption upon
               repayment of the Junior Subordinated Debt. The common securities
               of each trust are owned by the Corporation. The Corporation
               s obligations under the Junior Subordinated Debt and other
               relevant agreements, in aggregate, constitute a full and
               unconditional guarantee by the Corporation of each respective
               trusts obligations under the preferred securities issued
               by such trust.





The Series A
               Trust issued $500 million in aggregate liquidation amount of
               7.95% preferred capital securities on December 1, 1996. The sole
               asset of the Series A Trust is $515 million principal amount of
               7.95% Junior Subordinated Debt that will mature on December 1,
               2026, and is redeemable prior to maturity at the option of the
               Corporation on or after December 1, 2006.





The Series B
               Trust issued $250 million in aggregate liquidation amount of
               7.75% preferred capital securities on December 1, 1996. The sole
               asset of the Series B Trust is $258 million principal amount of
               7.75% Junior Subordinated Debt that will mature on December 1,
               2026, and is redeemable prior to maturity at the option of the
               Corporation on or after December 1, 2006.





The Series I
               Trust issued $250 million in aggregate liquidation amount of
               floating rate preferred capital securities in January 1997. The
               sole asset of the Series I Trust is $258 million principal
               amount of floating rate Junior Subordinated Debt of the
               Corporation, bearing interest at an annual rate equal to
               three-month LIBOR plus 0.55% that will mature on February 1,
               2027, and is redeemable at the option of the Corporation on or
               after February 1, 2007.





The Bank One
               Trust issued $575 million in aggregate liquidation amount of
               8.00% preferred capital securities on September 20, 1999. The
               sole asset of Bank One Trust is $593 million principal amount of
               8.00% Junior Subordinated Debt that will mature on September 15,
               2029, and is redeemable prior to maturity at the option of the
               Corporation on or after September 20, 2004.





The First USA
               Trust issued $200 million in aggregate liquidation amount of
               9.33% preferred capital securities on December 20, 1996. The
               sole asset of the First USA Trust was $200 million principal
               amount of 9.33% Junior Subordinated Debt. In June 1997, the
               Corporation paid a premium of $36 million to redeem $193 million
               of those securities.





The Trust
               Preferred Capital Securities are tax-advantaged issues and
               qualify as Tier 1 capital. Distributions on these securities are
               included in interest expense on long-term debt.





NOTE
               12Stock Dividends, Preferred Stock and Convertible
               Preferred Stock





On January 18,
               2000, the Corporation announced the discontinuation of the
               biannual 10% stock dividend.





On January 20,
               1998, the Corporation declared a 10% common stock dividend to
               Banc One shareholders of record on February 12, 1998.
               Accordingly, all common stock share data have been adjusted to
               include the effect of that dividend.





The Corporation
               is authorized to issue 50,000,000 shares of preferred stock with
               a par value of $0.01 per share. The Board of Directors is
               authorized to fix the particular designations, preferences,
               rights, qualifications and restrictions for each series of
               preferred stock issued. All preferred shares rank prior to
               common shares, both as to dividends and liquidation, but have no
               general voting rights. The dividend rate on each of the
               cumulative adjustable rate series is based on stated value and
               adjusted quarterly, based on a formula that considers the
               interest rates for selected short- and long-term U.S. Treasury
               securities prevailing at the time the rate is set.





|                          |  |      |  | Issued and
               
               Outstanding December 31 |  | Carrying Amount
               
               December 31 (In millions)
|------------------------- |  | ---- |  | ----------------------------------------------------------------- |  | ------------------------------------------------------------------------
|
|Preferred Stock           |  |      |  |                                                                   |  |                                                                         
|Series
                 B |  | $100 |  | 1,191,000                                                         |  | 1,191,000                                                               
|Series
                 C |  | 100  |  | 713,800                                                           |  | 713,800                                                                 




The minimum,
               maximum and current dividend rates for individual series of
               preferred stock are presented in the following
               table.





|December 31, 1999              |  | Shares
               
               Outstanding |  | Stated
               
               Value Per
               
               Share |  | Annual Dividend Rate |   | Redemption
               
               Price (1)
|------------------------------ |  | ------------------------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------- | - | ---------------------------------------------------
|
|Cumulative Adjustable Rate (2)
|Series
                 B      |  | 1,191,000                                         |  | $100.00                                                                              |  | 12.0                 | % |                                                    
|Series
                 C      |  | 713,800                                           |  | 100.00                                                                               |  | 12.5                 |   |                                                    




|(1) | Plus
                 accrued and unpaid dividends.
|--- | ---------------------------------------------------

|(2) | Currently redeemable.
|--- | ---------------------




On April 16,
               1998, the Corporation redeemed all of the shares of its Series C
               Convertible Preferred stock at the redemption price of $51.05
               per share plus the amount of any dividends accrued and
               unpaid.





NOTE 13
               Dividends and Capital Restrictions





The Corporation
               s national bank subsidiaries are subject to two statutory
               limitations on their ability to pay dividends. Under the first,
               dividends cannot exceed the level of undivided profits. In
               addition, a national bank cannot declare a dividend, without
               regulatory approval, in an amount in excess of its net income
               for the current year combined with the combined net profits for
               the preceding two years. State bank subsidiaries may also be
               subject to limitations on dividend payments. The amount of
               dividends available from certain nonbank subsidiaries that are
               subject to dividend restrictions is regulated by the governing
               agencies to which they report.





Based on these
               statutory requirements, the bank affiliates could, in the
               aggregate, have declared additional dividends of up to
               approximately $2.5 billion without regulatory approval at
               January 1, 2000. The payment of dividends by any bank may also
               be affected by other factors, such as the maintenance of
               adequate capital.





The bank
               affiliates are subject to various regulatory capital
               requirements that may require them to maintain minimum ratios of
               total and Tier 1 capital to risk-weighted assets and of Tier 1
               capital to average assets. Failure to meet minimum capital
               requirements results in certain actions by bank regulators that
               could have a direct material effect on the bank affiliates
               financial statements. As of December 31, 1999, management
               believed that each of the bank affiliates met all capital
               adequacy requirements to which it is subject and is correctly
               categorized
             as well-capitalized under the regulatory framework for prompt
               corrective action. There are no conditions or events since that
               categorization that management believes have changed the
               institutions category. For more information, see the
               Supervision and Regulation section, beginning on
               page 88.





The actual and
               required capital amounts and ratios for the Corporation and its
               principal banking subsidiaries are presented in the following
               two tables.





|                                                                  |  | Actual  |  | To
                  Be Categorized
               
               Adequately Capitalized
|----------------------------------------------------------------- |  | ------- |  | -----------------------------------------------------------------------------------------
|
|Risk-adjusted capital (to risk-weighted
                 assets):
|The
                 Corporation (consolidated)                   |  | $28,214 |  | 10.7                                                                                     
|Bank
                 One, N.A. (Chicago) (1)                     |  | 8,892   |  | 11.5                                                                                     
|Bank
                 One, N.A. (Columbus)                        |  | 3,207   |  | 10.1                                                                                     
|Bank
                 One, Texas, N.A.                            |  | 2,972   |  | 11.0                                                                                     
|Bank
                 One, Michigan (2)                           |  | 2,403   |  | 11.2                                                                                     
|Bank
                 One, Arizona, N.A.                          |  | 2,763   |  | 11.0                                                                                     
|First
                 USA Bank, N.A.                             |  | 2,493   |  | 18.3                                                                                     
|                                                                 
|Tier
                 1 capital (to risk-weighted assets):        |  |         |  |                                                                                          
|The
                 Corporation (consolidated)                   |  | $20,247 |  | 7.7                                                                                      
|Bank
                 One, N.A. (Chicago) (1)                     |  | 5,697   |  | 7.4                                                                                      
|Bank
                 One, N.A. (Columbus)                        |  | 2,157   |  | 6.8                                                                                      
|Bank
                 One, Texas, N.A.                            |  | 1,928   |  | 7.2                                                                                      
|Bank
                 One, Michigan (2)                           |  | 1,612   |  | 7.5                                                                                      
|Bank
                 One, Arizona, N.A.                          |  | 1,881   |  | 7.5                                                                                      
|First
                 USA Bank, N.A.                             |  | 2,201   |  | 16.2                                                                                     
|                                                                 
|Tier
                 1 leverage (to average assets):             |  |         |  |                                                                                          
|The
                 Corporation (consolidated)                   |  | $20,247 |  | 7.7                                                                                      
|Bank
                 One, N.A. (Chicago) (1)                     |  | 5,697   |  | 6.3                                                                                      
|Bank
                 One, N.A. (Columbus)                        |  | 2,157   |  | 6.6                                                                                      
|Bank
                 One, Texas, N.A.                            |  | 1,928   |  | 6.6                                                                                      
|Bank
                 One, Michigan (2)                           |  | 1,612   |  | 7.0                                                                                      
|Bank
                 One, Arizona, N.A.                          |  | 1,881   |  | 8.4                                                                                      
|First
                 USA Bank, N.A.                             |  | 2,201   |  | 12.0                                                                                     




|(1) | Formerly The First National Bank of
                 Chicago.
|--- | -------------------------------------------------------------

|(2) | Formerly NBD Bank (Michigan).
|--- | -----------------------------

|                                                                  |  | Actual  |  | To
                  Be Categorized
               
               Adequately Capitalized
|----------------------------------------------------------------- |  | ------- |  | -----------------------------------------------------------------------------------------
|
|Risk-adjusted capital (to risk-weighted
                 assets): |  |         |  |                                                                                          
|The
                 Corporation (consolidated)                   |  | $27,790 |  | 11.3                                                                                     
|Bank
                 One, N.A. (Chicago) (1)                     |  | 7,113   |  | 10.5                                                                                     
|Bank
                 One, N.A. (Columbus)                        |  | 2,766   |  | 10.8                                                                                     
|Bank
                 One, Texas, N.A.                            |  | 2,476   |  | 10.9                                                                                     
|Bank
                 One, Michigan (2)                           |  | 2,397   |  | 10.8                                                                                     
|Bank
                 One, Arizona, N.A.                          |  | 2,273   |  | 10.7                                                                                     
|First
                 USA Bank, N.A. (3)                         |  | 3,457   |  | 17.7                                                                                     
|                                                                 
|Tier
                 1 capital (to risk-weighted assets):        |  |         |  |                                                                                          
|The
                 Corporation (consolidated)                   |  | $19,495 |  | 7.9                                                                                      
|Bank
                 One, N.A. (Chicago) (1)                     |  | 4,821   |  | 7.1                                                                                      
|Bank
                 One, N.A. (Columbus)                        |  | 1,840   |  | 7.2                                                                                      
|Bank
                 One, Texas, N.A.                            |  | 1,601   |  | 7.0                                                                                      
|Bank
                 One, Michigan (2)                           |  | 1,549   |  | 7.0                                                                                      
|Bank
                 One, Arizona, N.A.                          |  | 1,408   |  | 6.6                                                                                      
|First
                 USA Bank, N.A. (3)                         |  | 2,909   |  | 14.9                                                                                     
|                                                                 
|Tier
                 1 leverage (to average assets):             |  |         |  |                                                                                          
|The
                 Corporation (consolidated)                   |  | $19,495 |  | 8.0                                                                                      
|Bank
                 One, N.A. (Chicago) (1)                     |  | 4,821   |  | 7.3                                                                                      
|Bank
                 One, N.A. (Columbus)                        |  | 1,840   |  | 7.2                                                                                      
|Bank
                 One, Texas, N.A.                            |  | 1,601   |  | 6.5                                                                                      
|Bank
                 One, Michigan (2)                           |  | 1,549   |  | 7.1                                                                                      
|Bank
                 One, Arizona, N.A.                          |  | 1,408   |  | 7.8                                                                                      
|First
                 USA Bank, N.A. (3)                         |  | 2,909   |  | 16.3                                                                                     




|(1) | Formerly The First National Bank of
                 Chicago.
|--- | -------------------------------------------------------------

|(2) | Formerly NBD Bank (Michigan).
|--- | -----------------------------

|(3) | Restated to show effect of the September 17, 1999,
                 merger with FCC National Bank.
|--- | --------------------------------------------------------------------------------------------------




Federal banking
               law restricts each bank subsidiary from extending credit to the
               Corporation in excess of 10% of the subsidiarys capital
               stock and surplus, as defined. Any such extensions of credit are
               subject to strict collateral requirements.





NOTE 14
               Supplemental Disclosures for Statement of Cash
               Flows





During 1999, the
               Corporation transferred $2.3 billion of asset-backed securities
               and variable corporate coupons from available for sale to
               trading assets. This transfer was for capital management
               purposes, and reflects the Corporations intent to sell
               these assets in the short term.





In connection
               with the Banc One/FCN Merger, a $656 million transfer was made
               in 1998 to reclassify debt investment securities from held to
               maturity to available for sale. A similar transfer of $3.6
               billion was made in 1997 in connection with the First USA
               acquisition. The reclassifications were made to maintain an
               interest rate risk position that existed prior to each business
               combination.





During 1998, the
               Corporation reclassified $9.5 billion from loans, and $468
               million from other assets, to investment securities
               available for sale. The amounts transferred represent the
               Corporations retained interests in its securitized credit
               card receivables.





Loans
               transferred to other real estate owned totaled $113 million,
               $239 million and $169 million in 1999, 1998 and 1997,
               respectively.





In 1997 the
               Corporation issued common stock in purchase transactions with a
               market value of $538 million.





In 1997, $154
               million of the Corporations Cumulative Convertible
               Preferred Stock, Series B, was converted into common
               stock.





NOTE 15
               Supplemental Disclosures for Accumulated Other Adjustments
               to Stockholders Equity





|(In
                  millions)                                                                                                                                           |  | 1999  |   | 1998 |      | 1997
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----- | - | ---- | ---- | ----
|Accumulated Other Adjustments to Stockholders
                 Equity                                                                                                    |  |       |   |      |      |     
|Fair
                 value adjustment on investment securitiesavailable for
                 sale                                                                       |  |       |   |      |      |     
|Balance,
                 beginning of period                                                                                                                             |  | $218  |   |      | $203 |     
|Change
                 in fair value, net of taxes of $(180) in 1999, $72 in 1998,
                 $101 in 1997                                                         |  | (391  | ) |      | 120  |     
|Reclassification adjustment, net of taxes of $(56) in
                 1999, $(57) in 1998, $(35) in
               
                         
                      1997 |  | (98   | ) |      | (105 | )   
|                                                                                                                                                                          |  |       |   |      |      |     
|Balance,
                 end of period                                                                                                                                   |  | (271  | ) |      | 218  |     
|                                                                                                                                                                          | 
|Accumulated translation adjustment                                                                                                                                        |  |       |   |      |      |     
|Balance,
                 beginning of period                                                                                                                             |  | 21    |   |      | 6    |     
|Translation gain(loss), net of taxes                                                                                                                                      |  | (13   | ) |      | 15   |     
|                                                                                                                                                                          |  |       |   |      |      |     
|Balance,
                 end of period                                                                                                                                   |  | 8     |   |      | 21   |     
|                                                                                                                                                                          |  |       |   |      |      |     
|Total
                 accumulated other adjustments to stockholders
                 equity                                                                             |  | $(263 | ) |      | $239 |     
|                                                                                                                                                                          |  |       |   |      |      |     




NOTE 16
               Employee Benefits





(a)
                 Pension Plans





The Corporation
               had various noncontributory pension plans during 1999 covering
               substantially all salaried employees. Effective December 31,
               1999, all noncontributory pension plans were combined into one
               plan.





The table below
               sets forth the Corporations qualified plans change
               in benefit obligation, change in plan assets and funded
               status.





|(In
                  millions)                         |  | 1999                     |   | 1998
|------------------------------------------------------- |  | ------------------------ | - | ----
|Change in benefit obligation                            |  |                          |   |     
|Benefit
                 obligation, January 1          |  | $2,380                   |   |     
|Service
                 cost                           |  | 116                      |   |     
|Interest cost                                           |  | 165                      |   |     
|Actuarial loss (gain)                                   |  | (259                     | ) |     
|Plan
                 change                            |  | 109                      |   |     
|Curtailment                                             |  | (12                      | ) |     
|Benefits paid                                           |  | (249                     | ) |     
|                                                        |  |                          |   |     
|Benefit
                 obligation, December 31        |  | 2,250                    |   |     
|                                                        |  |                          |   |     
|Change in plan assets                                   |  |                          |   |     
|Fair
                 value of plan assets, January 1   |  | 3,393                    |   |     
|Actual
                 return on plan assets           |  | 254                      |   |     
|Corporation contribution                                |  | 2                        |   |     
|Benefits paid                                           |  | (249                     | ) |     
|                                                        |  |                          |   |     
|Fair
                 value of plan assets, December 31 |  | 3,400                    |   |     
|                                                        |  |                          |   |     
|Funded status                                           |  | 1,150                    |   |     
|Unrecognized net actuarial loss (gain)                  |  | (655                     | ) |     
|Unrecognized prior service cost                         |  | 32                       |   |     
|Unrecognized net transition assets                      |  | (21                      | ) |     
|                                                        |  |                          |   |     
|Prepaid
                 pension costs, December 31     |  | $
                   506 |   |     
|                                                        |  |                          |   |     




Plan assets do
               not include any shares of the Corporations common stock at
               December 31, 1999, while 1.0 million shares were included at
               December 31, 1998, with a fair value of approximately $53
               million.





The table below
               sets forth net periodic pension cost for 1999, 1998 and 1997 for
               the Corporations qualified and nonqualified pension
               plans.





|(In
                  millions)                                 |  | 1999                     |   | 1998 |                         | 1997
|--------------------------------------------------------------- |  | ------------------------ | - | ---- | ----------------------- | ----
|Service
                 costbenefits earned during the period |  | $123                     |   |      | $135                    |     
|Interest cost on benefit obligation                             |  | 175                      |   |      | 172                     |     
|Expected return on plan assets                                  |  | (293                     | ) |      | (271                    | )   
|Amortization of prior service cost                              |  | (1                       | ) |      | (2                      | )   
|Recognized actuarial (gain)loss                                 |  | (1                       | ) |      | 1                       |     
|Amortization of transition assets                               |  | (13                      | ) |      | (13                     | )   
|Curtailment gain                                                |  | (13                      | ) |      |                        |     
|                                                                |  |                          |   |      |                         |     
|Net
                 periodic pension cost (credit)             |  | $
                   (23 | ) |      | $ 
                  22 |     
|                                                                |  |                          |   |      |                         |     




The accrued
               pension cost for the Corporations nonqualified
               supplemental pension plans was $90 million in 1999 and $92
               million in 1998. Such plans are unfunded.





The table below
               sets forth the assumptions used in determining the Corporation
               s benefit obligation and net periodic pension cost for
               both qualified and nonqualified supplemental pension
               plans.





|                                                                       |  | 1999 |   | 1998 |      | 1997
|---------------------------------------------------------------------- |  | ---- | - | ---- | ---- | ----
|Actuarial assumptions:                                                 |  |      |   |      |      |     
|Weighted-average discount rate for benefit
                 obligation |  | 8.00 | % |      | 7.00 | %   
|Weighted-average rate of compensation
                 increase        |  | 5.00 | % |      | 5.00 | %   
|Expected
                 long-term rate of return on plan assets      |  | 9.50 | % |      | 9.50 | %   




(b)
                 Postretirement Benefits Other Than
               Pensions





The Corporation
               sponsors postretirement life insurance plans and provides health
               care benefits for certain retirees and grandfathered employees
               when they retire. The postretirement life insurance benefit is
               noncontributory, while the health care benefits are
               contributory.





The table
               below sets forth the Corporations postretirement benefit
               plans change in benefit obligation and funded status at
               December 31, 1999 and 1998. There are no plan
               assets.





|(In
                  millions)                                    |  | 1999  |   | 1998
|------------------------------------------------------------------ |  | ----- | - | ----
|Change in benefit obligation                                       |  |       |   |     
|Benefit
                 obligation, January 1                     |  | $190  |   |     
|Service
                 cost                                      |  | 1     |   |     
|Interest cost                                                      |  | 13    |   |     
|Actuarial loss (gain)                                              |  | (21   | ) |     
|Benefits paid                                                      |  | (19   | ) |     
|Plan
                 change                                       |  |      |   |     
|                                                                   |  |       |   |     
|Benefit
                 obligation, December 31                   |  | 164   |   |     
|                                                                   |  |       |   |     
|Change in plan assets                                              |  |       |   |     
|Fair
                 value of plan assets, January 1              |  |      |   |     
|Employer contribution                                              |  | 19    |   |     
|Benefits paid                                                      |  | (19   | ) |     
|                                                                   |  |       |   |     
|Fair
                 value of plan assets, December 31            |  |      |   |     
|                                                                   |  |       |   |     
|Funded status                                                      |  | (164  | ) |     
|Unrecognized net actuarial loss (gain)                             |  | (17   | ) |     
|Unrecognized prior service cost                                    |  | (47   | ) |     
|                                                                   |  |       |   |     
|Accrued
                 postretirement benefit costs, December 31 |  | $(228 | ) |     
|                                                                   |  |       |   |     




Net periodic
               cost for postretirement health care and life insurance benefits
               during 1999, 1998 and 1997 include the following:





|(In
                  millions)                                                 |  | 1999                   |   | 1998 |                        | 1997
|------------------------------------------------------------------------------- |  | ---------------------- | - | ---- | ---------------------- | ----
|Service
                 costbenefits earned during the period                 |  | $
                   1 |   |      | $ 
                  6 |     
|Interest cost on accumulated postretirement benefit
                 obligation |  | 13                     |   |      | 17                     |     
|Recognized actuarial (gain)                                                     |  |                       |   |      |                       |     
|Amortization of prior service costs                                             |  | (12                    | ) |      |                       |     
|Adjustment for acquisitions                                                     |  | 2                      |   |      |                       |     
|Curtailment gain                                                                |  |                       |   |      |                       |     
|                                                                                |  |                        |   |      |                        |     
|Net
                 periodic postretirement benefit cost                       |  | $
                   4 |   |      | $23                    |     
|                                                                                |  |                        |   |      |                        |     




The
               weighted-average discount rate used in determining the
               accumulated postretirement benefit obligation was 8.00% at
               December 31, 1999, and 7.00% at December 31, 1998.





For measurement
               purposes, an annual rate of increase ranging from 5.50%
               6.00% was assumed for 1999 in the cost of covered health
               care benefits; this range was assumed to decrease gradually to
               as low as 5.00%5.50% in the years 2000 and 2001 and
               thereafter. These assumptions have a significant effect on the
               amounts reported. Accordingly, the table below sets forth the
               effect of a 1.00% change in the assumed health-care-cost trend
               rates.





|(In
                  millions)                                                                              |  | 1%
                  increase |  | 1%
                  decrease
|------------------------------------------------------------------------------------------------------------ |  | ----------------------------- |  | -----------------------------
|Effect
                 on 1999 service and interest cost components                                         |  | $ 
                  0.8      |  | $(0.7                        
|Effect
                 on December 31, 1999, accumulated postretirement benefit
                 obligation |  | $11.0                         |  | $(9.6                        




(c)
               401(k) Plans





The Corporation
               sponsors various 401(k) plans that cover substantially all of
               its employees. Up until 2000, the Corporation was required to
               make contributions to the plans in varying amounts. The expense
               related to these plans was $81 million in 1999, $89 million in
               1998 and $78 million in 1997. Effective December 31, 1999, all
               new contributions will be made to one Corporation-sponsored
               401(k) plan, thereby establishing uniform contribution
               requirements for the entire Corporation.





NOTE 17
               Stock-Based Compensation





The Corporation
               utilizes several types of stock-based awards as part of its
               overall compensation program. In addition, the Corporation
               provides employees the opportunity to purchase its shares
               through various employee stock purchase plans. The Corporation
               s stock-based compensation plans provide for the granting
               of awards to purchase or receive common shares and include
               limits as to the aggregate number of shares available for grants
               and the total number of shares available for grants of stock
               awards in any one year. The compensation cost that has been
               charged against income for the Corporations stock-based
               compensation plans was $38 million for 1999, $52 million for
               1998 and $71 million for 1997. As a result of the 1999
               fourth-quarter restructuring plan, $4 million was recorded as a
               restructuring charge related to the immediate vesting of
               restricted shares for certain executives. In 1998, $113 million
               was recorded as a restructuring charge related to the immediate
               vesting of certain restricted and performance shares resulting
               from the respective changes in control at FCN and First
               Commerce. See Note 1(n) on page 45 for the Corporations
               accounting policies relating to stock-based
               compensation.





(a)
               Performance Shares





Prior to the
               Merger, the Corporation provided performance-based stock awards
               for certain of its senior managers. The level of performance
               shares eventually distributed depends on the achievement of
               specific performance criteria that are set at the grant date.
               The ultimate expense attributable to these shares is based on
               the market value of the shares distributed at the end of the
               defined performance period. The expense associated with such
               awards is recognized over the defined performance period. As a
               result of the respective changes in control of FCN and First
               Commerce, all performance share awards originally granted by
               these entities immediately vested at the time of the respective
               changes of control, and the maximum performance standards were
               deemed to have been achieved.





(b)
               Restricted Shares





Restricted
               shares granted to key officers of the Corporation require them
               either to continue employment for a stated number of years from
               the grant date before restrictions on the shares are released.
               The market value of the restricted shares as of the date of
               grant is amortized to compensation expense ratably over the
               period the shares remain restricted. Holders of restricted stock
               receive dividends and have the right to vote the shares. As a
               result of the respective changes in control at FCN and First
               Commerce in 1998, substantially all outstanding restricted stock
               issued at these entities vested immediately at the time of the
               respective changes in control.





(c)
               Stock Options





The Corporation
               s stock option plans generally provide that the exercise
               price of any stock option may not be less than the fair market
               value of the common stock on the date of grant.





There are a
               number of stock option plans, and they have distinct provisions.
               Awards generally vest over a period of two to four years.
               Options are not exercisable for at least one year from the date
               of grant and have a maximum term of eight to 20 years. Some
               option plans include the right to receive additional options if
               certain criteria are met. The vesting period for such additional
               options is six months. As a result of the change in control at
               FCN and First Commerce in 1998, all outstanding stock options
               issued at these entities vested and became exercisable
               immediately at the time of the respective changes in
               control.





The following
               tables summarize stock option activity for 1999, 1998 and 1997,
               respectively, and provide details of stock options outstanding
               at December 31, 1999, for the Corporation:





|                            |  | 1999   |   | 1998 |        | 1997
|--------------------------- |  | ------ | - | ---- | ------ | ----
|
|Outstanding at January 1    |  | 38,247 |   |      | $34.34 |     
|Granted                     |  | 15,556 |   |      | 50.35  |     
|Exercised                   |  | (6,473 | ) |      | 24.34  |     
|Forfeited                   |  | (2,700 | ) |      | 36.56  |     
|                            |  |        |   |      |        |     
|Outstanding at December 31  |  | 44,630 |   |      | $40.88 |     
|                            |  |        |   |      |        |     
|Exerciseable at December 31 |  | 19,847 |   |      | $32.86 |     
|                            |  |        |   |      |        |     




|(Shares in Thousands)                |  | Options Outstanding |  | Options Exerciseable
|------------------------------------ |  | ------------------- |  | --------------------
|
|Less
                 than $20.00    |  | 4,552               |  | $16.45              
|$20.00
                 $30.00      |  | 7,116               |  | 24.84               
|$30.01
                 $40.00      |  | 7,277               |  | 35.62               
|$40.01
                 $50.00      |  | 6,264               |  | 46.60               
|$50.01
                 $55.00      |  | 14,296              |  | 50.28               
|Greater
                 than $55.01 |  | 5,125               |  | 59.08               
|                                     |  |                     |  |                     
|Total                                |  | 44,630              |  | $40.88              
|                                     |  |                     |  |                     




(d)
                 Employee Stock Purchase Plan





The Corporation
               sponsors an Employee Stock Purchase Plan designed to encourage
               employee stock ownership. This plan allows eligible employees to
               purchase shares of the Corporations common stock at a 15%
               discount from the market price at the date of enrollment or the
               market price at the end of the plan, whichever is lower. During
               one-year offering periods, the employee is allowed to make
               deposits of up to 20% of his/her earnings to an interest-bearing
               savings account to purchase the number of shares permissible
               under the plan. The maximum number of shares each participant
               may purchase cannot exceed the contribution limit divided by the
               applicable purchase price on the offering date. The Corporation
               does not recognize any compensation expense with respect to this
               plan.





(e)
                 Pro Forma Costs of Stock-Based
               Compensation





The grant date
               fair values of stock options granted under the Corporation
               s various stock option plans and the Employee Stock
               Purchase Plan were estimated using the Black-Scholes
               option-pricing model. This model was developed to estimate the
               fair value of traded options, which have different
               characteristics than employee stock options. In addition,
               changes to the subjective input assumptions can result in
               materially different fair market value estimates. Therefore, the
               Black-Scholes model may not necessarily provide a reliable
               single measure of the fair value of employee stock options and
               purchase rights.





The following
               table summarizes stock-based compensation grants and their
               related weighted-average grant-date fair values for the years
               ended December 31:





|                                    |  | 1999   |  | 1998   |  | 1997 
|----------------------------------- |  | ------ |  | ------ |  | -----
|
|Stock
                 option plans |  | 15,556 |  | $12.28 |  | 8,896
|Restricted shares                   |  | 1,728  |  | 51.13  |  | 651  
|Performance shares                  |  |       |  |       |  |     
|Employee Stock Purchase Plan(1)     |  | 2,974  |  | 7.28   |  |     




|(1) | Estimated number of shares that employees would
                 purchase under the plan.
|--- | -----------------------------------------------------------------------------------------




The following
               assumptions were used to determine the Black-Scholes
               weighted-average grant date fair value of stock option awards
               and conversions in 1999, 1998 and 1997: (1) expected dividend
               yields ranged from 2.08% 4.86%, (2) expected volatility
               ranged from 17.93%36.44%, (3) risk-free interest rates
               ranged from 4.46%6.95% and (4) expected lives ranged from
               2 years to 13 years.





The following
               assumptions were used to determine the Black-Scholes
               weighted-average grant-date fair value of employees
               purchase rights under the employee stock purchase plans in 1999
               and 1997, respectively: (1) expected dividend yields of 2.86%
               and 2.54%, (2) expected volatility of 34.68% and 22.70%, (3)
               risk-free interest rates of 5.07% and 5.73% and (4) expected
               lives of 1.0 and 1.3 years. As certain employee stock purchase
               plans expired during 1998 and no additional rights were granted,
               determination of the average grant date fair value was not
               required in 1998.





Had the
               compensation cost for the Corporations stock-based
               compensation plans been determined in accordance with the
               fair-value-based accounting method provided by SFAS No. 123, the
               net income and earnings per share implications for the years
               ended December 31, 1999, 1998 and 1997 would have been as
               follows:





|                                                      |  | 1999   |  | 1998   |  | 1997  
|----------------------------------------------------- |  | ------ |  | ------ |  | ------
|
|Net
                 income                           |  | $3,413 |  | $3,479 |  | $3,034
|Net
                 income per common share, basic   |  | 2.91   |  | 2.97   |  | 2.58  
|Net
                 income per common share, diluted |  | 2.89   |  | 2.95   |  | 2.55  




|(1) | The
                 above pro forma information may not be representative of the
                 pro forma impact in future years.
|--- | ------------------------------------------------------------------------------------------------------------------------------------




As a result of
               the change in control at FCN and First Commerce, additional
               compensation expense of
             
             $21 million associated with the accelerated vesting of stock
               options, was included in the 1998 pro forma net income under
               SFAS No. 123.





NOTE
               18Income Taxes





The components
               of total applicable income tax expense in the consolidated
               income statement for the years ended December 31, 1999, 1998 and
               1997, are as follows:





|(In
                  millions)      |  | 1999                     |  | 1998                     |  | 1997                    
|------------------------------------ |  | ------------------------ |  | ------------------------ |  | ------------------------
|Income
                 tax expense: |  |                          |  |                          |  |                         
|Current                              |  |                          |  |                          |  |                         
|Federal                              |  | $
                   735 |  | $ 
                  801 |  | $ 
                  826
|Foreign                              |  | 2                        |  | 4                        |  | 12                      
|State                                |  | 97                       |  | 98                       |  | 84                      
|                                     |  |                          |  |                          |  |                         
|Total                                |  | 834                      |  | 903                      |  | 922                     
|Deferred                             |  |                          |  |                          |  |                         
|Federal                              |  | 624                      |  | 424                      |  | 488                     
|State                                |  | 37                       |  | 30                       |  | 57                      
|                                     |  |                          |  |                          |  |                         
|Total                                |  | 661                      |  | 454                      |  | 545                     
|                                     |  |                          |  |                          |  |                         
|Applicable income taxes              |  | $1,495                   |  | $1,357                   |  | $1,467                  
|                                     |  |                          |  |                          |  |                         




The tax effects
               of fair value adjustments on securities available for sale,
               foreign currency translation adjustments and certain tax
               benefits related to stock options are recorded directly to
               stockholders equity. The net tax benefit recorded directly
               to stockholders equity amounted to $(259) million in 1999,
               $(66) million in 1998 and $(28) million in 1997.





A summary
               reconciliation of the differences between applicable income
               taxes and the amounts computed at the applicable regular federal
               tax rate of 35% follows:





|(Dollars in millions)                                                                                                                  |  | 1999   |   | 1998 |      | 1997
|-------------------------------------------------------------------------------------------------------------------------------------- |  | ------ | - | ---- | ---- | ----
|Statutory tax rate                                                                                                                     |  | $1,741 |   |      | 35.0 | %   
|Increase (decrease) resulting from:                                                                                                    |  |        |   |      |      |     
|State
                 income taxes, net of federal income tax
               
                         
                      benefit |  | 87     |   |      | 1.8  |     
|Tax-exempt interest                                                                                                                    |  | (66    | ) |      | (1.3 | )   
|Tax
                 credits                                                                                                           |  | (133   | ) |      | (2.7 | )   
|Nontaxable liquidating distributions                                                                                                   |  |       |   |      |     |     
|Other,
                 net                                                                                                            |  | (134   | ) |      | (2.7 | )   
|                                                                                                                                       |  |        |   |      |      |     
|Applicable income taxes                                                                                                                |  | $1,495 |   |      | 30.1 | %   
|                                                                                                                                       |  |        |   |      |      |     




A net deferred
               tax liability is included in other liabilities in the
               consolidated balance sheet as a result of temporary differences
               between the carrying amounts of assets and liabilities in the
               financial statements and their related tax bases. The components
               of the net deferred tax liability as of December 31, 1999 and
               1998, are as follows:





|(In
                  millions)                     |  | 1999   |  | 1998  
|--------------------------------------------------- |  | ------ |  | ------
|Deferred tax liabilities                            |  |        |  |       
|Deferred
                 income on lease financing |  | $3,632 |  | $2,887
|Prepaid
                 pension costs              |  | 91     |  | 99    
|Securitizations of credit card receivables          |  | 247    |  | 142   
|Other                                               |  | 95     |  | 852   
|                                                    |  |        |  |       
|Gross
                 deferred tax liabilities     |  | 4,065  |  | 3,980 
|Deferred tax assets                                 |  |        |  |       
|Allowance for credit losses                         |  | 969    |  | 874   
|Restructure reserves                                |  | 142    |  | 276   
|Alternative minimum tax credit carryforward         |  |       |  | 116   
|Other                                               |  | 108    |  | 535   
|                                                    |  |        |  |       
|Gross
                 deferred tax assets          |  | 1,219  |  | 1,801 
|                                                    |  |        |  |       
|Net
                 deferred tax liability         |  | $2,846 |  | $2,179
|                                                    |  |        |  |       




NOTE 19
               Lease Commitments





The Corporation
               has entered into a number of operating and capitalized lease
               agreements for premises and equipment. The minimum annual rental
               commitments under these leases are shown below.





|(In
                  millions)     
|------------------------------------
|2000                                
|2001                                
|2002                                
|2003                                
|2004                                
|2005
                 and thereafter
|                                    
|Total                               
|                                    




Occupancy
               expense has been reduced by rental income from premises leased
               to others in the amount of $87 million in 1999, $101 million in
               1998 and $107 million in 1997. Rental expense under operating
               leases approximated $414 million in 1999, $356 million in 1998
               and $320 million in 1997.





NOTE 20
               Financial Instruments with Off-Balance Sheet
               Risk





In the normal
               course of business, the Corporation is a party to financial
               instruments containing credit and/or market risks that are not
               required to be reflected in the balance sheet. These financial
               instruments include credit-related instruments as well as
               certain derivative instruments. The Corporation has risk
               management policies to identify, monitor and limit exposure to
               credit, liquidity and market risks.





The following
               disclosures represent the Corporations credit exposure,
               assuming that every counterparty to financial instruments with
               off-balance sheet credit risk fails to perform completely
               according to the terms of the contracts, and that the collateral
               and other security, if any, proves to be of no value to the
               Corporation.





This note does
               not address the amount of market losses the Corporation would
               incur if future changes in market prices make financial
               instruments with off-balance sheet market risk less valuable or
               more onerous.





(a)
                 Collateral and Other Security
               Arrangements





The credit risk
               of both on- and off-balance sheet financial instruments varies
               based on many factors, including the value of collateral held
               and other security arrangements. To mitigate credit risk, the
               Corporation generally determines the need for specific covenant,
               guarantee and collateral requirements on a case-by-case basis,
               depending on the nature of the financial instrument and the
               customers creditworthiness. The Corporation may also
               receive comfort letters and oral assurances. The amount and type
               of collateral held to reduce credit risk varies but may include
               real estate, machinery, equipment, inventory and accounts
               receivable, as well as cash on deposit, stocks, bonds and other
               marketable securities that are generally held in the Corporation
               s possession or at another appropriate custodian or
               depository. This collateral is valued and inspected on a regular
               basis to ensure both its existence and adequacy. Additional
               collateral is requested when appropriate.





(b)
                  Credit-Related Financial
               Instruments





The table below
               summarizes credit-related financial instruments, including both
               commitments to extend credit and letters of credit.





|December 31 (In
                  billions)                              |  | 1999   |  | 1998  
|------------------------------------------------------------------------ |  | ------ |  | ------
|Unused
                 credit card lines                                |  | $270.5 |  | $259.0
|Unused
                 loan commitments                                 |  | 143.6  |  | 114.1 
|Standby
                 letters of credit and foreign office guarantees |  | 16.8   |  | 14.0  
|Commercial letters of credit                                             |  | 0.8    |  | 1.2   




Since many of
               the unused commitments are expected to expire unused or be only
               partially used, the total amount of unused commitments in the
               preceding table does not necessarily represent future cash
               requirements.





Credit card
               lines allow customers to use a credit card to buy goods or
               services and to obtain cash advances. However, the Corporation
               has the right to change or terminate any terms or conditions of
               a customers credit card account, upon notification to the
               customer. Loan commitments are agreements to make or acquire a
               loan or lease as long as the agreed-upon terms (e.g., expiry,
               covenants or notice) are met. The Corporations commitments
               to purchase or extend loans help its customers meet their
               liquidity needs.





Standby letters
               of credit and foreign office guarantees are issued in connection
               with agreements made by customers to counterparties. If the
               customer fails to comply with the agreement, the counterparty
               may enforce the standby letter of credit or foreign office
               guarantee as a remedy. Credit risk arises from the possibility
               that the customer may not be able to repay the Corporation for
               standby letters of credit or foreign office guarantees. At
               December 31, 1999 and 1998, standby letters of credit and
               foreign office guarantees had been issued for the following
               purposes:





|December 31 (In
                  millions) |  | 1999    |  | 1998   
|------------------------------------------- |  | ------- |  | -------
|Financial                                   |  | $14,261 |  | $11,843
|Performance                                 |  | 2,551   |  | 2,140  
|                                            |  |         |  |        
|Total
                 (1)                  |  | $16,812 |  | $13,983
|                                            |  |         |  |        




|(1) | Includes $1.9 billion at December 31, 1999, and $1.4
                 billion at December 31, 1998, participated to other
                 institutions.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------




At December 31,
               1999, $12.2 billion of standby letters of credit and foreign
               office guarantees was due to expire within three years, and $4.6
               billion was to expire after three years.





Commercial
               letters of credit are issued or confirmed to ensure payment of
               customers payables or receivables in short-term
               international trade transactions. Generally, drafts will be
               drawn when the underlying transaction is consummated as
               intended. However, the short-term nature of this instrument
               serves to mitigate the risk associated with these
               contracts.





(c)
                 Derivative Financial Instruments





The Corporation
               enters into a variety of derivative financial instruments in its
               trading, asset and liability management, and corporate
               investment activities. These instruments offer customers
               protection from rising or falling interest rates, exchange
               rates, equity prices and commodity prices. They can either
               reduce or increase the Corporations exposure to such
               changing rates or prices.





Following is a
               brief description of such derivative financial
               instruments.





| | · | Interest rate forward and futures contracts represent
                 commitments either to purchase or sell a financial instrument
                 at a specified future date for a specified price, and may be
                 settled in cash or through delivery.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




| | · | An
                 interest rate swap is an agreement in which two parties agree
                 to exchange, at specified intervals, interest payment streams
                 calculated on an agreed-upon notional principal amount with at
                 least one stream based on a specified floating rate
                 index.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




| | · | Interest rate options are contracts that grant the
                 purchaser, for a premium payment, the right either to purchase
                 from or sell to the writer of the option, a financial
                 instrument at a specified price within a specified period of
                 time or on a specified date.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




| | · | Interest rate caps and floors are contracts with
                 notional principal amounts that require the seller, in
                 exchange for a fee, to make payments to the purchaser if a
                 specified market interest rate exceeds the fixed cap rate or
                 falls below the fixed floor rate on specified future
                 dates.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




| | · | Forward
                 rate agreements are contracts with notional principal amounts
                 that settle in cash at a specified future date based on the
                 differential between a specified market interest rate and a
                 fixed interest rate.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




| | · | Foreign
                 exchange contracts represent swap, spot, forward, futures and
                 option contracts to exchange currencies.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------




| | · | Equity
                 price contracts represent swap, forward, futures, cap, floor
                 and option contracts that derive their values from underlying
                 equity prices.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




| | · | Commodity price contracts represent swap, futures, cap,
                 floor and option contracts that derive their value from
                 underlying commodity prices.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




The Corporation
               s objectives and strategies for using derivative financial
               instruments for structural interest rate risk management and
               foreign exchange risk management are discussed on pages 19
               21.





Balance sheet
               exposure for derivative financial instruments includes the
               amount of recognized gains in the market valuations of those
               contracts. Those amounts fluctuate as a function of maturity,
               interest rates, foreign exchange rates, equity prices and
               commodity prices.





The credit risk
               associated with exchange-traded derivative financial instruments
               is limited to the relevant clearinghouse. Options written do not
               expose the Corporation to credit risk, except to the extent of
               the underlying risk in a financial instrument that the
               Corporation may be obligated to acquire under certain written
               put options. Caps and floors written do not expose the
               Corporation to credit risk.





On some
               derivative financial instruments, the Corporation may have
               additional risk. This is due to the underlying risk in the
               financial instruments that the Corporation may be obligated to
               acquire or the risk that the Corporation will deliver under a
               contract but that the customer will fail to deliver the
               countervailing amount. The Corporation believes that its credit
               and settlement procedures minimize these risks.





Not all
               derivative financial instruments have off-balance sheet market
               risk. Market risk associated with options purchased and caps and
               floors purchased is recorded in the balance sheet.





The table on
               page 30 reports the Corporations gross notional principal
               or contractual amounts of derivative financial instruments as of
               December 31, 1999, and December 31, 1998. These instruments
               include swaps, forwards, spot, futures, options, caps, floors,
               forward rate agreements, and other conditional and exchange
               contracts. The amounts do not represent the market or credit
               risk associated with these contracts, as previously defined, but
               rather give an indication of the volume of the
               transactions.





NOTE 21
               Fair Value of Financial Instruments





The Corporation
               is required to disclose the estimated fair value of its
               financial instruments in accordance with SFAS No. 107,
               Disclosures about Fair Value of Financial Instruments.
                These disclosures do not attempt to estimate or represent
               the Corporations fair value as a whole. The disclosure
               excludes assets and liabilities that are not financial
               instruments as well as the significant unrecognized value
               associated with core deposits and credit card
               relationships.





Fair value
               amounts disclosed represent point-in-time estimates that may
               change in subsequent reporting periods due to market conditions
               or other factors. Estimated fair value amounts in theory
               represent the amounts at which financial instruments could be
               exchanged or settled in a current transaction between willing
               parties. In practice, however, this may not be the case due to
               inherent limitations in the methodologies and assumptions used
               to estimate fair value. For example, quoted market prices may
               not be realized because the financial instrument may be traded
               in a market that lacks liquidity; or a fair value derived using
               a discounted cash flow approach may not be the amount realized
               because of the subjectivity involved in selecting underlying
               assumptions, such as projecting cash flows or selecting a
               discount rate. The fair value amount also may not be realized
               because it ignores transaction costs and does not include
               potential tax effects. The Corporation does not plan to dispose
               of, either through sale or settlement, the majority of its
               financial instruments at these estimated fair
               values.





The following
               table summarizes the carrying values and estimated fair values
               of financial instruments as of December 31, 1999 and
               1998.





|                                                                     |  | 1999                        |   | 1998
|-------------------------------------------------------------------- |  | --------------------------- | - | ----
|
|Financial assets                                                     |  |                             |   |     
|Cash and
                 other short-term financial instruments (a) |  | $
                   32,869 |   |     
|Trading
                 assets (a)                                  |  | 7,952                       |   |     
|Investment securities (b)                                            |  | 47,912                      |   |     
|Loans
                 (c)                                           |  | 163,877                     |   |     
|Allowance for credit losses                                          |  | (2,285                      | ) |     
|                                                                     |  |                             |   |     
|Loans,
                 net                                          |  | 161,592                     |   |     
|Derivative product assets                                            |  |                             |   |     
|Trading
                 purposes (1)(f)                             |  | 3,160                       |   |     
|Other
                 than trading purposes (f)                     |  | 212                         |   |     
|                                                                     |  |                             |   |     
|Total
                 derivative product assets                     |  | 3,372                       |   |     
|Financial instruments in other assets (a)                            |  | 1,911                       |   |     
|Financial liabilities                                                |  |                             |   |     
|Deposits
                 (d)                                        |  | 162,278                     |   |     
|Securities sold but not yet purchased (a)                            |  | 753                         |   |     
|Other
                 short-term financial instruments (a)          |  | 39,544                      |   |     
|Long-term debt (2)(e)                                                |  | 35,435                      |   |     
|Derivative product liabilities                                       |  |                             |   |     
|Trading
                 purposes (1)(f)                             |  | 3,115                       |   |     
|Other
                 than trading purposes (f)                     |  | 217                         |   |     
|                                                                     |  |                             |   |     
|Total
                 derivative product liabilities                |  | 3,332                       |   |     
|Financial instruments in other liabilities
                 (a)      |  | 1,363                       |   |     




|(1) | The
                 estimated average fair values of derivative financial
                 instruments used in trading activities during 1999 were $4.3
                 billion classified as assets and $4.4 billion classified as
                 liabilities.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Includes trust preferred capital
                 securities.
|--- | -------------------------------------------------------------




Estimated fair
               values are determined as follows:





(a)
                 Financial Instruments Whose Carrying Value
               Approximates Fair Value





A financial
               instruments carrying value approximates its fair value
               when the financial instrument has an immediate or short-term
               maturity (generally one year or less), or is carried at fair
               value.





Quoted market
               prices or dealer quotes typically are used to estimate fair
               values of trading securities and securities sold but not yet
               purchased.





Commitments to
               extend credit and letters of credit typically result in loans
               with a market interest rate when funded. The recorded book value
               of deferred fee income approximates the fair value.





(b)
                 Investment Securities





Quoted market
               prices typically are used to estimate the fair value of debt
               investment securities. Quoted market prices for similar
               securities are used to estimate fair value when a quoted market
               price is not available for a specific debt investment security.
               See Note 1(c) on page 42 for the methodologies used to determine
               the fair value of equity investment securities.





(c)
                 Loans





The loan
               portfolio was segmented based on loan type, credit quality and
               repricing characteristics. Carrying values are used to estimate
               fair values of certain variable rate loans with no significant
               credit concerns and frequent repricing. A discounted cash flow
               method was used to estimate the fair value of other loans.
               Discounting was based on the contractual cash flows, and
               discount rates typically are based on the year-end yield curve
               plus a spread that reflects pricing on loans with similar
               characteristics. If applicable, prepayment assumptions are
               factored into the fair value determination based on historical
               experience and current economic and lending
               conditions.





(d)
                 Deposits





The amount
               payable on demand at the report date is used to estimate fair
               value of demand and savings deposits with no defined maturity. A
               discounted cash flow method is used to estimate the fair value
               of fixed-rate time deposits. Discounting was based on the
               contractual cash flows and the current rates at which similar
               deposits with similar remaining maturities would be issued,
               adjusted for servicing costs. Carrying value typically is used
               to estimate the fair value of floating-rate time
               deposits.





(e)
                 Long-Term Debt





Quoted market
               prices or the discounted cash flow method was used to estimate
               the fair value of the Corporations fixed-rate long-term
               debt. Discounting was based on the contractual cash flows and
               the current rates at which debt with similar terms could be
               issued. Carrying value typically is used to estimate the fair
               value of floating-rate long-term debt.





(f)
                 Derivative Product Assets and
               Liabilities





Quoted market
               prices or pricing and valuation models were used to estimate the
               fair value of derivative product assets and liabilities.
               Assumptions input into models were based on current market
               information.





NOTE 22
               Related Party Transactions





Certain
               executive officers, directors and their related interests are
               loan customers of the Corporations affiliates. The
               Securities and Exchange Commission (the Commission)
               has determined that, with respect to the Corporation and
               significant subsidiaries (as defined by the Commission),
               disclosure of borrowings by directors and executive officers and
               certain of their related interests should be made if the loans
               are greater than 5% of stockholders equity, in the
               aggregate. These loans in aggregate were not greater than 5% of
               stockholders equity at December 31, 1999 or
               1998.





NOTE 23
               Pledged Assets





Assets having a
               book value of $62.7 billion as of December 31, 1999, and $38.2
               billion as of December 31, 1998, were pledged as collateral for
               repurchase agreements, off-balance sheet investment products,
               and governmental and trust department deposits in accordance
               with federal and state requirements, and for other purposes
               required by law. The $24.5 billion increase from the prior year
               was primarily due to a significant increase in loans pledged by
               the Corporation to the Federal Reserve in connection with Year
               2000 preparedness.





The Corporation
               s bank affiliates are required to maintain average
               noninterest-bearing cash balances, in accordance with Federal
               Reserve Board regulations. The average required reserve balances
               were $2.9 billion in 1999 and $3.5 billion in 1998.





NOTE 24
               Collateral Policy Related to Certain Asset Transfer
               Activity





It is the
               Corporations policy to take possession of securities
               purchased under agreements to resell. The Corporation monitors
               the fair value of the underlying securities as compared to the
               related receivable, including accrued interest, and adjusts the
               level of collateral as necessary.





With respect
               to securities lent, the Corporation receives collateral in the
               form of cash or other collateral in an amount generally in
               excess of the fair value of the lent securities. The Corporation
               monitors the fair value of the securities lent on a daily basis,
               and additional cash or securities are obtained as
               necessary.





NOTE 25
               Contingent Liabilities





The Corporation
               and certain of its subsidiaries have been named as defendants in
               various legal proceedings, including certain class actions,
               arising out of the normal course of their business or
               operations. In certain of these proceedings, which are based on
               alleged violations of consumer protection, securities, banking
               and other laws, substantial money damages are asserted against
               the Corporation and its subsidiaries. Since the Corporation and
               certain of its subsidiaries, which are regulated by one or more
               federal and state regulatory authorities, are the subject of
               numerous examinations and reviews by such authorities, the
               Corporation is and will be, from time to time, normally engaged
               in various disagreements with regulators, related primarily to
               banking matters. The Corporation has also received certain tax
               deficiency assessments. Management does not believe that
               liabilities arising from these matters, if any, will have a
               material adverse effect on the consolidated financial position,
               liquidity or results of operations of the
               Corporation.





NOTE 26
               BANK ONE CORPORATION (Parent Company Only)


Condensed Financial Statements





Condensed Balance Sheet





|December 31 (In
                  millions)                 |  | 1999                        |  | 1998                        
|----------------------------------------------------------- |  | --------------------------- |  | ----------------------------
|Assets                                                      |  |                             |  |                             
|Cash
                 and due from banks                    |  |                             |  |                             
|Bank
                 subsidiaries                          |  | $
                       16 |  | $ 
                        4
|Other                                                       |  |                            |  | 2                           
|Interest-bearing due from banks                             |  |                             |  |                             
|Bank
                 subsidiaries                          |  | 2,836                       |  | 1,818                       
|Other                                                       |  |                            |  | 10                          
|Investment securitiesavailable for
                 sale   |  | 353                         |  | 72                          
|Loans
                 and receivablessubsidiaries         |  |                             |  |                             
|Bank
                 subsidiaries                          |  | 7,109                       |  | 5,720                       
|Nonbank
                 subsidiaries                       |  | 8,845                       |  | 6,894                       
|Investment in subsidiaries                                  |  |                             |  |                             
|Bank
                 subsidiaries                          |  | 20,148                      |  | 21,325                      
|Nonbank
                 subsidiaries                       |  | 4,255                       |  | 1,723                       
|Other
                 assets                               |  | 445                         |  | 474                         
|                                                            |  |                             |  |                             
|Total
                 assets                               |  | $44,007                     |  | $38,042                     
|                                                            |  |                             |  |                             
|Liabilities and Stockholders
                 Equity       |  |                             |  |                             
|Short-term borrowings                                       |  |                             |  |                             
|Nonbank
                 subsidiaries                       |  | $
                       66 |  | $ 
                    106  
|Other                                                       |  | 1,268                       |  | 1,191                       
|Long-term debt                                              |  |                             |  |                             
|Nonbank
                 subsidiaries                       |  | 1,621                       |  | 1,028                       
|Other                                                       |  | 20,118                      |  | 14,004                      
|Other
                 liabilities                          |  | 844                         |  | 1,153                       
|                                                            |  |                             |  |                             
|Total
                 liabilities                          |  | 23,917                      |  | 17,482                      
|Stockholders equity                                        |  | 20,090                      |  | 20,560                      
|                                                            |  |                             |  |                             
|Total
                 liabilities and stockholders equity |  | $44,007                     |  | $38,042                     
|                                                            |  |                             |  |                             










BANK
               ONE CORPORATION (Parent Company Only)


Condensed Income Statement





|For
                  the Year (In millions)                                      |  | 1999   |   | 1998 |        | 1997
|--------------------------------------------------------------------------------- |  | ------ | - | ---- | ------ | ----
|Operating Income                                                                  |  |        |   |      |        |     
|Dividends                                                                         |  |        |   |      |        |     
|Bank
                 subsidiaries                                                |  | $2,367 |   |      | $4,087 |     
|Nonbank
                 subsidiaries                                             |  | 373    |   |      | 359    |     
|Interest income                                                                   |  |        |   |      |        |     
|Bank
                 subsidiaries                                                |  | 534    |   |      | 478    |     
|Nonbank
                 subsidiaries                                             |  | 438    |   |      | 247    |     
|Other                                                                             |  | 11     |   |      | 8      |     
|Management and other fees from affiliates                                         |  |       |   |      | 606    |     
|Other
                 income                                                     |  |        |   |      |        |     
|Bank
                 subsidiaries                                                |  | 7      |   |      |       |     
|Other                                                                             |  | 190    |   |      | 26     |     
|                                                                                  |  |        |   |      |        |     
|Total                                                                             |  | 3,920  |   |      | 5,811  |     
|Operating Expense                                                                 |  |        |   |      |        |     
|Interest expense                                                                  |  |        |   |      |        |     
|Nonbank
                 subsidiaries                                             |  | 93     |   |      | 80     |     
|Other                                                                             |  | 1,132  |   |      | 863    |     
|Merger-related charges                                                            |  | 287    |   |      | 675    |     
|Salaries and employee benefits                                                    |  | 9      |   |      | 209    |     
|Professional fees and services                                                    |  | 3      |   |      | 76     |     
|Marketing and development                                                         |  |       |   |      | 60     |     
|Other
                 expense                                                    |  | 97     |   |      | 373    |     
|                                                                                  |  |        |   |      |        |     
|Total                                                                             |  | 1,621  |   |      | 2,336  |     
|Income Before Income Taxes and Equity in
                 Undistributed           |  |        |   |      |        |     
|Net
                 Income of Subsidiaries                                       |  | 2,299  |   |      | 3,475  |     
|Applicable income taxes (benefit)                                                 |  | (198   | ) |      | (284   | )   
|                                                                                  |  |        |   |      |        |     
|Income Before Equity in Undistributed Net Income of
                 Subsidiaries |  | 2,497  |   |      | 3,759  |     
|Equity
                 in undistributed net income of subsidiaries               |  |        |   |      |        |     
|Bank
                 subsidiaries                                                |  | 797    |   |      | (420   | )   
|Nonbank
                 subsidiaries                                             |  | 185    |   |      | (231   | )   
|                                                                                  |  |        |   |      |        |     
|Net
                 Income                                                       |  | $3,479 |   |      | $3,108 |     
|                                                                                  |  |        |   |      |        |     










BANK
               ONE CORPORATION (Parent Company Only)


Condensed Statement of Cash Flows





|For
                  the Year (In millions)                                                            |  | 1999                       |   | 1998 |                            | 1997
|------------------------------------------------------------------------------------------------------- |  | -------------------------- | - | ---- | -------------------------- | ----
|Cash
                 Flows from Operating Activities                                                   |  |                            |   |      |                            |     
|Net
                 income                                                                             |  | $
                   3,479 |   |      | $ 
                  3,108 |     
|Adjustments to reconcile net income to net cash
                 provided by operating activities:      |  |                            |   |      |                            |     
|Equity
                 in net income of subsidiaries                                                   |  | (3,722                     | ) |      | (3,965                     | )   
|Dividends received from subsidiaries                                                                    |  | 2,740                      |   |      | 4,446                      |     
|Other
                 noncash adjustments                                                              |  | 417                        |   |      | 17                         |     
|                                                                                                        |  |                            |   |      |                            |     
|Total
                 adjustments                                                                      |  | (565                       | ) |      | 498                        |     
|                                                                                                        |  |                            |   |      |                            |     
|Net
                 cash provided by operating activities                                              |  | 2,914                      |   |      | 3,606                      |     
|                                                                                                       
|Cash
                 Flows from Investing Activities                                                   |  |                            |   |      |                            |     
|Net
                 (increase) in loans to subsidiaries                                                |  | (3,226                     | ) |      | (3,024                     | )   
|Net
                 (increase) decrease in capital investments in
                 subsidiaries        |  | (1,277                     | ) |      | (1,559                     | )   
|Purchase of investment securitiesavailable for
                 sale                                   |  | (805                       | ) |      | (38                        | )   
|Proceeds from sales and maturities of investment
                 securitiesavailable for sale         |  | 729                        |   |      | 44                         |     
|Sale of
                 premises and equipment                                                         |  |                           |   |      |                           |     
|Other,
                 net                                                                             |  | (29                        | ) |      |                           |     
|                                                                                                        |  |                            |   |      |                            |     
|Net
                 cash (used in) investing activities                                                |  | (4,608                     | ) |      | (4,577                     | )   
|                                                                                                       
|Cash
                 Flows from Financing Activities                                                   |  |                            |   |      |                            |     
|Net
                 increase (decrease) in commercial paper and short-term
                 borrowings |  | 37                         |   |      | 443                        |     
|Proceeds from issuance of long-term debt                                                                |  | 9,524                      |   |      | 3,387                      |     
|Redemption and repayment of long-term debt                                                              |  | (2,843                     | ) |      | (350                       | )   
|Dividends paid                                                                                          |  | (2,420                     | ) |      | (1,322                     | )   
|Proceeds from issuance of common and treasury
                 stock                                    |  | 61                         |   |      | 161                        |     
|Purchase of treasury stock                                                                              |  | (1,647                     | ) |      | (375                       | )   
|Payment
                 for redemption of preferred stock                                              |  |                           |   |      |                           |     
|Other
                 financing activities, net                                                        |  |                           |   |      |                           |     
|                                                                                                        |  |                            |   |      |                            |     
|Net
                 cash provided by (used in) financing activities                                    |  | 2,712                      |   |      | 1,944                      |     
|                                                                                                        | 
|Net
                 Increase (Decrease) in Cash and Cash
                 Equivalents                  |  | 1,018                      |   |      | 973                        |     
|Cash
                 and Cash Equivalents at Beginning of Year                                         |  | 1,834                      |   |      | 861                        |     
|                                                                                                        |  |                            |   |      |                            |     
|Cash
                 and Cash Equivalents at End of Year                                               |  | $
                   2,852 |   |      | $ 
                  1,834 |     
|                                                                                                        |  |                            |   |      |                            |     
|                                                                                                       
|Other Cash-Flow Disclosures                                                                             |  |                            |   |      |                            |     
|Interest paid                                                                                           |  | $
                   1,113 |   |      | $ 
                    923 |     
|Income
                 tax payment (receipt)                                                           |  | (335                       | ) |      | (50                        | )   




In connection
               with issuances of commercial paper, the Corporation has an
               agreement providing future credit availability (back-up lines of
               credit) with non-affiliated banks. The agreements aggregated
               $300 million at December 31, 1999. The commitment fee paid under
               these agreements was 0.07%. The back-up lines of credit,
               together with overnight money market loans, short-term
               investments and other sources of liquid assets, exceeded the
               amount of commercial paper issued at December 31,
               1999.








REPORT OF
             INDEPENDENT
             PUBLIC
             ACCOUNTANTS





To the
               Stockholders and Board of Directors


| | of BANK
                 ONE CORPORATION:
| | -----------------------------------------




We have audited
               the accompanying consolidated balance sheet of BANK ONE
               CORPORATION (a Delaware corporation) and subsidiaries as of
               December 31, 1999 and 1998, and the related consolidated
               statements of income, stockholders equity and cash flows
               for each of the three years in the period ended December 31,
               1999. These financial statements are the responsibility of BANK
               ONE CORPORATIONs management. Our responsibility is to
               express an opinion on these financial statements based on our
               audits.





We conducted our
               audits in accordance with auditing standards generally accepted
               in the United States. Those standards require that we plan and
               perform the audit to obtain reasonable assurance about whether
               the financial statements are free of material misstatement. An
               audit includes examining, on a test basis, evidence supporting
               the amounts and disclosures in the financial statements. An
               audit also includes assessing the accounting principles used and
               significant estimates made by management, as well as evaluating
               the overall financial statement presentation. We believe that
               our audits provide a reasonable basis for our
               opinion.





In our opinion,
               the consolidated financial statements referred to above present
               fairly, in all material respects, the financial position of BANK
               ONE CORPORATION and subsidiaries as of December 31, 1999 and
               1998, and the results of their operations and their cash flows
               for each of the three years in the period ended December 31,
               1999, in conformity with accounting principles generally
               accepted in the United States.





| | 
| | 

/s/
               Arthur Andersen LLP


Chicago,
               Illinois,


January
               17, 2000





SELECTED
             STATISTICAL
             INFORMATION





BANK
               ONE CORPORATION and Subsidiaries





Investment Securities





|December 31 (In
                  millions)                               |  | 1999                       |  | 1998                       |  | 1997                      
|------------------------------------------------------------------------- |  | -------------------------- |  | -------------------------- |  | --------------------------
|Available for sale                                                        |  |                            |  |                            |  |                           
|U.S.
                 Treasury                                            |  | $
                   2,469 |  | $ 
                  4,550 |  | $ 
                  7,920
|U.S.
                 government agencies                                 |  | 12,510                     |  | 10,559                     |  | 8,644                     
|States
                 and political subdivisions                        |  | 1,581                      |  | 2,064                      |  | 1,955                     
|Retained
                 interest in securitized credit card receivables |  | 20,593                     |  | 17,370                     |  | N/A                       
|Other
                 debt securities                                    |  | 7,306                      |  | 8,171                      |  | 4,949                     
|Equity
                 securities                                        |  | 3,453                      |  | 2,138                      |  | 1,786                     
|                                                                          |  |                            |  |                            |  |                           
|Total
                 available for sale                                 |  | 47,912                     |  | 44,852                     |  | 25,254                    
|Held to
                 maturity                                         |  |                            |  |                            |  |                           
|States
                 and political subdivisions                        |  |                           |  |                           |  | 451                       
|All
                 other                                                |  |                           |  |                           |  | 334                       
|                                                                          |  |                            |  |                            |  |                           
|Total
                 held to maturity                                   |  |                           |  |                           |  | 785                       
|                                                                          |  |                            |  |                            |  |                           
|Total                                                                     |  | $47,912                    |  | $44,852                    |  | $26,039                   
|                                                                          |  |                            |  |                            |  |                           




N/ANot
               applicable.





Maturity of Debt Investment Securities





As of December
               31, 1999, debt investment securities had the following maturity
               and yield characteristics:





|                                                   |  | Due
                  in 1 year
               
               or less |  | Due
                  after 1 year
               
               through 5 years |   | Due
                  after 5 years
               
               through 10 years |                            | Due
                  after
               
               10 years |      | Total
|-------------------------------------------------- |  | ---------------------------------------------------------------------- |  | --------------------------------------------------------------------------------- | - | ----------------------------------------------------------------------------------- | -------------------------- | ------------------------------------------------------------------- | ---- | -----
|
|U.S.
                 Treasury                     |  | $ 
                    714                                             |  | 5.14                                                                              | % |                                                                                     | $ 
                  1,319 |                                                                     | 5.23 | %    
|U.S.
                 government agencies          |  | 2,368                                                                  |  | 5.31                                                                              |   |                                                                                     | 3,945                      |                                                                     | 5.45 |      
|States
                 and political subdivisions |  | 215                                                                    |  | 5.39                                                                              |   |                                                                                     | 678                        |                                                                     | 5.26 |      
|Other
                 debt securities             |  | 21,271                                                                 |  | 8.86                                                                              |   |                                                                                     | 4,611                      |                                                                     | 7.25 |      
|                                                   |  |                                                                        |  |                                                                                   |   |                                                                                     |                            |                                                                     |      |      
|Total                                              |  | $24,568                                                                |  | 8.38                                                                              | % |                                                                                     | $10,553                    |                                                                     | 6.19 | %    
|                                                   |  |                                                                        |  |                                                                                   |   |                                                                                     |                            |                                                                     |      |      







Securitization of Credit Card Receivables





The Corporation
               continues to service credit card accounts even after receivables
               are securitized. Net interest income and certain fee revenue on
               the securitized portfolio are not recognized; however, these are
               offset by servicing fees as well as by lower provisions for
               credit losses.





For analytical
               purposes only, the following table shows income statement line
               items adjusted for the net impact of securitization of credit
               card receivables.





|                                                                                                                                                                 |  | 1999                        
|---------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------------
|
|Net
                 interest incometax-equivalent basis                                                                                                        |  | $
                     9,142
|Provision for credit losses                                                                                                                                      |  | 1,249                       
|Noninterest income                                                                                                                                               |  | 8,692                       
|Noninterest expense                                                                                                                                              |  | 11,490                      
|Net
                 income                                                                                                                                      |  | 3,479                       
|Total
                 average loans                                                                                                                             |  | 156,855                     
|Total
                 average earning assets                                                                                                                    |  | 223,539                     
|Total
                 average assets                                                                                                                            |  | 256,491                     
|Net
                 interest margin                                                                                                                             |  | 4.09                        
|Delinquency and charge-off rates:                                                                                                                                |  |                             
|Credit
                 card delinquencies over 30 days as a percentage of ending
                 credit
               
                    card loan balances |  | 4.06                        
|Credit
                 card delinquencies over 90 days as a percentage of ending
                 credit
               
                    card loan balances |  | 1.87                        
|Net
                 credit card charge-offs as a percentage of average credit card
                 loan
               
                    balances           |  | 4.73                        
|
|
|Net
                 interest incometax-equivalent basis                                                                                                        |  | $ 
                    9,469
|Provision for credit losses                                                                                                                                      |  | 1,408                       
|Noninterest income                                                                                                                                               |  | 8,071                       
|Noninterest expense                                                                                                                                              |  | 11,545                      
|Net
                 income                                                                                                                                      |  | 3,108                       
|Total
                 average loans                                                                                                                             |  | 154,952                     
|Total
                 average earning assets                                                                                                                    |  | 209,514                     
|Total
                 average assets                                                                                                                            |  | 239,790                     
|Net
                 interest margin                                                                                                                             |  | 4.52                        
|Delinquency and charge-off rates:                                                                                                                                |  |                             
|Credit
                 card delinquencies over 30 days as a percentage of ending
                 credit
               
                    card loan balances |  | 3.34                        
|Credit
                 card delinquencies over 90 days as a percentage of ending
                 credit
               
                    card loan balances |  | 1.41                        
|Net
                 credit card charge-offs as a percentage of average credit card
                 loan
               
                    balances           |  | 5.52                        







Maturity Distribution and Interest Rate Sensitivity of
               Loans





The following
               table shows a distribution of the maturity of loans and, for
               those loans due after one year, a breakdown between those loans
               that have floating interest rates and those that have
               predetermined interest rates. The amounts exclude domestic
               consumer loans and domestic lease financing
               receivables.





|December 31, 1999 (In
                  millions)        |  | One
                  Year
               
               or Less |  | One
                  to
               
               Five Years |  | Over
               
               Five Years |  | Total  
|-------------------------------------------------------- |  | ----------------------------------------------------------------- |  | ------------------------------------------------------------------ |  | ---------------------------------------------- |  | -------
|Domestic                                                 |  |                                                                   |  |                                                                    |  |                                                |  |        
|Commercial                                               |  | $21,261                                                           |  | $28,914                                                            |  | $5,486                                         |  | $55,661
|Real
                 estate                             |  | 9,418                                                             |  | 12,194                                                             |  | 3,041                                          |  | 24,653 
|                                                         |  |                                                                   |  |                                                                    |  |                                                |  |        
|Total
                 domestic                          |  | 30,679                                                            |  | 41,108                                                             |  | 8,527                                          |  | 80,314 
|Foreign                                                  |  | 3,599                                                             |  | 3,102                                                              |  | 366                                            |  | 7,067  
|                                                         |  |                                                                   |  |                                                                    |  |                                                |  |        
|Total                                                    |  | $34,278                                                           |  | $44,210                                                            |  | $8,893                                         |  | $87,381
|                                                         |  |                                                                   |  |                                                                    |  |                                                |  |        
|Loans
                 with floating interest rates      |  |                                                                   |  | $32,929                                                            |  | $4,705                                         |  | $37,634
|Loans
                 with predetermined interest rates |  |                                                                   |  | 11,281                                                             |  | 4,188                                          |  | 15,469 
|                                                         |  |                                                                   |  |                                                                    |  |                                                |  |        
|Total                                                    |  |                                                                   |  | $44,210                                                            |  | $8,893                                         |  | $53,103
|                                                         |  |                                                                   |  |                                                                    |  |                                                |  |        




Loans
               90 Days or More Past Due and Still Accruing
               Interest





Loans that were
               90 or more days past due and still accruing interest totaled
               $703 million, $769 million, $994 million, $918 million and $628
               million at December 31, 1999, 1998, 1997, 1996 and 1995,
               respectively.





Foreign Outstandings





The table below
               presents a breakout of foreign outstandings for the past three
               years, where such outstandings exceeded 1.0% of total assets.
               Included in claims are loans, balances with banks, acceptances,
               securities, equity investments, accrued interest, other monetary
               assets and current credit exposure on derivative contracts. At
               year-end 1998, there were no countries for which cross-border
               and net local country claims exceeded 1.0% of total
               assets.





|(In
                 millions)
               
               December 31, 1999 |  | Cross-Border Claims |  | Net
                  Local
               
               Country
               
               Claims |  | Total Cross
               
               Border &
               
               Net Local
               
               Country
               
               Claims
|------------------------------------------------------------------------------- |  | ------------------- |  | -------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
|Germany
                 (1)                                                    |  | $2,199              |  | $600                                                                                                     |  | $319                                                                                                                                                                     
|
|Japan
                 (2)                                                      |  | 4,225               |  |                                                                                                         |  | 386                                                                                                                                                                      




|(1) | At
                 year-end 1999, local country claims were reduced by $129
                 million of local country liabilities.
|--- | -----------------------------------------------------------------------------------------------------------------------------------

|(2) | At
                 year-end 1997, local country claims were reduced by $83
                 million of local country liabilities.
|--- | ----------------------------------------------------------------------------------------------------------------------------------




At December 31,
               1999 and 1997, there were no countries for which cross-border
               and net local country claims totaled between 0.75% and 1.0% of
               total assets. At December 31, 1998, Germany was the only country
               for which cross-border and net local country claims totaled
               between 0.75% and 1.0% of total assets. These outstandings
               amounted to $2.194 billion.





Deposits





The following
               tables show a maturity distribution of domestic time
               certificates of deposit of $100,000 and over, other domestic
               time deposits of $100,000 and over, and deposits in foreign
               offices, predominantly in amounts in excess of $100,000, at
               December 31, 1999.





Domestic Time Certificates of Deposit of $100,000 and
               Over





|(Dollars in millions)                             |  | Amount                     |  | Percent
|------------------------------------------------- |  | -------------------------- |  | -------
|Three
                 months or less             |  | $
                   6,699 |  | 49     
|Over
                 three months to six months  |  | 1,295                      |  | 10     
|Over
                 six months to twelve months |  | 3,161                      |  | 23     
|Over
                 twelve months               |  | 2,391                      |  | 18     
|                                                  |  |                            |  |        
|Total                                             |  | $13,546                    |  | 100    
|                                                  |  |                            |  |        




Domestic Other Time Deposits of $100,000 and
               Over





|(Dollars in millions)                             |  | Amount |  | Percent
|------------------------------------------------- |  | ------ |  | -------
|Three
                 months or less             |  | $351   |  | 70     
|Over
                 three months to six months  |  | 10     |  | 2      
|Over
                 six months to twelve months |  | 108    |  | 21     
|Over
                 twelve months               |  | 37     |  | 7      
|                                                  |  |        |  |        
|Total                                             |  | $506   |  | 100    
|                                                  |  |        |  |        




Foreign Offices





|(Dollars in millions)                             |  | Amount  |  | Percent
|------------------------------------------------- |  | ------- |  | -------
|Three
                 months or less             |  | $28,440 |  | 96     
|Over
                 three months to six months  |  | 595     |  | 2      
|Over
                 six months to twelve months |  | 694     |  | 2      
|Over
                 twelve months               |  | 43      |  |       
|                                                  |  |         |  |        
|Total                                             |  | $29,772 |  | 100    
|                                                  |  |         |  |        







Short-Term Borrowings





Borrowings with
               original maturities of one year or less are classified as
               short-term. The following is a summary of short-term borrowings
               for each of the three years ended December 31:





|(Dollars in millions)                                   |  | 1999                       |   | 1998 |                            | 1997
|------------------------------------------------------- |  | -------------------------- | - | ---- | -------------------------- | ----
|Federal
                 funds purchased                |  |                            |   |      |                            |     
|Outstanding at year-end                                 |  | $
                   5,483 |   |      | $12,112                    |     
|Weighted-average rate at year-end.                      |  | 4.54                       | % |      | 4.65                       | %   
|Daily
                 average outstanding for the year |  | $
                   7,060 |   |      | $ 
                  9,262 |     
|Weighted-average rate for the year                      |  | 4.96                       | % |      | 5.24                       | %   
|Highest
                 outstanding at any month-end   |  | $
                   8,806 |   |      | $12,112                    |     
|                                                       
|Securities under repurchase agreements                  |  |                            |   |      |                            |     
|Outstanding at year-end                                 |  | $13,237                    |   |      | $11,052                    |     
|Weighted-average rate at year-end                       |  | 4.08                       | % |      | 4.43                       | %   
|Daily
                 average outstanding for the year |  | $12,651                    |   |      | $12,423                    |     
|Weighted-average rate for the year                      |  | 4.62                       | % |      | 4.87                       | %   
|Highest
                 outstanding at any month-end   |  | $16,102                    |   |      | $15,676                    |     
|                                                       
|Bank
                 notes                             |  |                            |   |      |                            |     
|Outstanding at year-end                                 |  | $12,707                    |   |      | $10,321                    |     
|Weighted-average rate at year-end                       |  | 5.60                       | % |      | 5.22                       | %   
|Daily
                 average outstanding for the year |  | $11,112                    |   |      | $ 
                  8,175 |     
|Weighted-average rate for the year                      |  | 5.57                       | % |      | 5.52                       | %   
|Highest
                 outstanding at any month-end   |  | $12,947                    |   |      | $10,321                    |     
|                                                       
|Commercial paper                                        |  |                            |   |      |                            |     
|Outstanding at year-end                                 |  | $
                   3,184 |   |      | $ 
                  2,113 |     
|Weighted-average rate at year-end                       |  | 6.09                       | % |      | 4.54                       | %   
|Daily
                 average outstanding for the year |  | $
                   3,006 |   |      | $ 
                  1,882 |     
|Weighted-average rate for the year                      |  | 5.23                       | % |      | 5.58                       | %   
|Highest
                 outstanding at any month-end   |  | $
                   3,595 |   |      | $ 
                  2,491 |     
|                                                       
|Other
                 short-term borrowings            |  |                            |   |      |                            |     
|Outstanding at year-end                                 |  | $
                   5,320 |   |      | $ 
                  4,503 |     
|Weighted-average rate at year-end                       |  | 4.46                       | % |      | 4.51                       | %   
|Daily
                 average outstanding for the year |  | $
                   3,739 |   |      | $ 
                  3,733 |     
|Weighted-average rate for the year                      |  | 4.98                       | % |      | 4.86                       | %   
|Highest
                 outstanding at any month-end   |  | $
                   5,475 |   |      | $ 
                  7,202 |     
|                                                       
|Total
                 short-term borrowings            |  |                            |   |      |                            |     
|Outstanding at year-end                                 |  | $39,931                    |   |      | $40,101                    |     
|Weighted-average rate at year-end                       |  | 4.86                       | % |      | 4.73                       | %   
|Daily
                 average outstanding for the year |  | $37,568                    |   |      | $35,475                    |     
|Weighted-average rate for the year                      |  | 5.00                       | % |      | 5.15                       | %   




|                                                          |  | 1999   |   | 1998 |        | 1997 |  | 1996   |   | 1995
|--------------------------------------------------------- |  | ------ | - | ---- | ------ | ---- |  | ------ | - | ----
|Common Stock and Stockholder Data
                 (1)(2) |  |        |   |      |        |      |  |        |   |     
|Market
                 price                             |  |        |   |      |        |      |  |        |   |     
|High for
                 the year                        |  | $63.13 |   |      | $64.78 |      |  | $54.37 |   |     
|Low for
                 the year                         |  | 29.98  |   |      | 37.58  |      |  | 35.57  |   |     
|At
                 year-end                              |  | 32.00  |   |      | 51.06  |      |  | 49.37  |   |     
|Book
                 value (at year-end)                 |  | 17.34  |   |      | 17.31  |      |  | 16.03  |   |     
|Dividend payout ratio                                     |  | 57     | % |      | 58     | %    |  | 61     | % |     




|(1) | There
                 were 119,152 common stockholders of record as of December 31,
                 1999.
|--- | -----------------------------------------------------------------------------------------------------------

|(2) | The
                 principal market for the Corporations common stock is
                 the New York Stock Exchange. The Corporations common
                 stock also is listed on the Chicago Stock
                 Exchange.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|Financial Ratios                                                      |  | 1999 |   | 1998 |      | 1997 |  | 1996 |   | 1995
|--------------------------------------------------------------------- |  | ---- | - | ---- | ---- | ---- |  | ---- | - | ----
|Net
                 income as a percentage of:                      
|Average
                 stockholders equity                         |  | 17.0 | % |      | 15.8 | %    |  | 15.6 | % |     
|Average
                 common stockholders equity                  |  | 17.2 |   |      | 15.9 |      |  | 16.0 |   |     
|Average
                 total assets                                 |  | 1.4  |   |      | 1.3  |      |  | 1.3  |   |     
|Average
                 earning assets                               |  | 1.6  |   |      | 1.5  |      |  | 1.5  |   |     
|Stockholders equity at year-end as a percentage
                 of:
|Total
                 assets at year-end                             |  | 7.5  |   |      | 7.9  |      |  | 8.0  |   |     
|Total
                 loans at year-end                              |  | 12.3 |   |      | 13.2 |      |  | 11.9 |   |     
|Total
                 deposits at year-end                           |  | 12.4 |   |      | 12.7 |      |  | 12.4 |   |     
|Average
                 stockholders equity as a percentage of:    
|Average
                 assets                                       |  | 8.0  |   |      | 8.2  |      |  | 8.2  |   |     
|Average
                 loans                                        |  | 13.0 |   |      | 12.7 |      |  | 12.2 |   |     
|Average
                 deposits                                     |  | 13.2 |   |      | 13.1 |      |  | 12.9 |   |     
|Income
                 to fixed charges:                            
|Excluding interest on deposits                                        |  | 2.3  | x |      | 2.3  | x    |  | 2.4  | x |     
|Including interest on deposits                                        |  | 1.6  | x |      | 1.5  | x    |  | 1.5  | x |     







Quarterly Financial Data





|(In
                 millions, except ratios
               
               and per share data) |  | 1999                     |   | 1998
|----------------------------------------------------------------------------------------------- |  | ------------------------ | - | ----
|
|Income and Expense:                                                                             |  |                          |   |     
|Net
                 interest incometax-
               
                   equivalent basis   |  | $2,221                   |   |     
|Provision for credit losses                                                                     |  | 416                      |   |     
|Noninterest income                                                                              |  | 1,782                    |   |     
|Merger-related and restructuring
               
                   charges                     |  | 189                      |   |     
|Operating expense                                                                               |  | 2,841                    |   |     
|Net
                 income                                                                     |  | 411                      |   |     
|Per
                 Common Share Data:                                                        
|Net
                 income, basic                                                              |  | $
                  0.36 |   |     
|Net
                 income, diluted                                                            |  | 0.36                     |   |     
|Cash
                 dividends declared                                                        |  | 0.42                     |   |     
|Book
                 value                                                                     |  | 17.34                    |   |     
|Balance Sheet:                                                                                 
|Loans:                                                                                         
|Managed                                                                                         |  | $229,196                 |   |     
|Reported                                                                                        |  | 163,877                  |   |     
|Deposits                                                                                        |  | 162,278                  |   |     
|Long-term debt(1)                                                                               |  | 35,435                   |   |     
|Total
                 assets                                                                   |  | 269,425                  |   |     
|Common
                 stockholders equity                                                    |  | 19,900                   |   |     
|Total
                 stockholders equity                                                     |  | 20,090                   |   |     
|Performance Ratios:                                                                            
|Return
                 on assets                                                               |  | 0.62                     | % |     
|Return
                 on common equity                                                        |  | 8.2                      |   |     
|Net
                 interest margin:                                                          
|Managed                                                                                         |  | 4.98                     |   |     
|Reported                                                                                        |  | 3.79                     |   |     
|Efficiency ratio:                                                                              
|Managed                                                                                         |  | 62.1                     | % |     
|Reported                                                                                        |  | 75.7                     |   |     
|Equity Ratios:                                                                                 
|Regulatory leverage ratio                                                                       |  | 7.7                      | % |     
|Risk-based capital:                                                                            
|Tier 1
                 ratio                                                                   |  | 7.7                      |   |     
|Total capital
                 ratio                                                            |  | 10.7                     |   |     
|Credit Quality:                                                                                
|Net
                 charge-offs to average loans                                               |  | 0.95                     | % |     
|Ending
                 allowance to loans                                                      |  | 1.39                     |   |     
|Nonperforming assets to related
               
                   assets                       |  | 0.71                     |   |     
|Common Stock Data:                                                                             
|Average
                 shares outstanding, basic                                              |  | 1,147                    |   |     
|Average
                 shares outstanding,
               
                   diluted         |  | 1,154                    |   |     
|Stock
                 price:                                                                  
|High                                                                                            |  | $39.56                   |   |     
|Low                                                                                             |  | 29.98                    |   |     
|Close                                                                                           |  | 32.00                    |   |     







|(1) | Includes trust preferred capital
                 securities.
|--- | -------------------------------------------------------------




Average Balances/Net Interest Margin/Rates





BANK
               ONE CORPORATION and Subsidiaries





|                                                                                                     |  | Year
                 Ended December 31
|---------------------------------------------------------------------------------------------------- |  | ---------------------------------------
|
|
|Short-term investments                                                                               |  | $
                   13,976            
|Trading
                 assets                                                                      |  | 6,128                                  
|Investment securities (1)                                                                            |  |                                        
|U.S. government and
                 federal agencies                                                |  | 15,228                                 
|States and political
                 subdivisions                                                   |  | 1,835                                  
|Other (2)                                                                                            |  | 29,517                                 
|                                                                                                     |  |                                        
|Total investment
                 securities                                                         |  | 46,580                                 
|Loans
                 (3)                                                                           |  |                                        
|Commercial                                                                                           |  | 90,182                                 
|Consumer                                                                                             |  | 59,440                                 
|Credit
                 card                                                                         |  | 7,233                                  
|                                                                                                     |  |                                        
|Total loans                                                                                          |  | 156,855                                
|Total earning assets
                 (4)                                                            |  | 223,539                                
|Allowance for credit losses                                                                          |  | (2,290                                 
|Other
                 assets                                                                        |  | 35,242                                 
|                                                                                                     |  |                                        
|Total assets                                                                                         |  | $256,491                               
|                                                                                                     |  |                                        
|Deposits
                 interest-bearing                                                          |  |                                        
|Savings                                                                                              |  | $
                   19,866            
|Money
                 market                                                                        |  | 44,730                                 
|Time                                                                                                 |  | 35,202                                 
|Foreign offices
                 (5)                                                                 |  | 24,157                                 
|                                                                                                     |  |                                        
|Total deposits
                 interest-bearing                                                    |  | 123,955                                
|Federal
                 funds purchased and securities under repurchase
                 agreements |  | 19,711                                 
|Other
                 short-term borrowings                                                         |  | 17,857                                 
|Long-term debt (6)                                                                                   |  | 29,367                                 
|                                                                                                     |  |                                        
|Total interest-bearing
                 liabilities                                                  |  | 190,890                                
|Demand
                 deposits                                                                     |  | 31,229                                 
|Other
                 liabilities                                                                   |  | 13,918                                 
|Preferred stock                                                                                      |  | 190                                    
|Common
                 stockholders equity                                                         |  | 20,264                                 
|                                                                                                     |  |                                        
|Total liabilities and
                 stockholders equity                                          |  | $256,491                               
|                                                                                                     |  |                                        
|Interest income/earning assets                                                                       |  |                                        
|Interest expense/earning assets                                                                      |  |                                        
|                                                                                                     |  |                                        
|Net
                 interest margin                                                                 |  |                                        
|                                                                                                     |  |                                        







|(1) | The
                 combined amounts for investment securities available for sale
                 and held to maturity are based on their respective carrying
                 values. Based on the amortized cost of investment securities
                 available for sale, the combined average balance for 1999,
                 1998, 1997, 1996 and 1995 would be $46.612 billion, $33.415
                 billion, $26.246 billion, $28.613 billion and $32.841 billion,
                 respectively, and the average earned rate in 1999, 1998, 1997,
                 1996 and 1995 would be 6.90%, 7.12%, 6.63%, 6.73% and 6.72%,
                 respectively.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | The
                 Corporations undivided interest in securitized credit
                 card receivables was reclassified from loans to investment
                 securities during 1998. Such amounts averaged $16,048 million
                 for 1999 and $5,798 million for 1998.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Nonperforming loans are included in average balances
                 used to determine rates.
|--- | ----------------------------------------------------------------------------------------------

|(4) | Includes tax-equivalent adjustments based on federal
                 income tax rate of 35%.
|--- | ---------------------------------------------------------------------------------------------

|(5) | Includes international banking facilities deposit
                 balances in domestic offices and balances of Edge Act and
                 overseas offices.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------

|(6) | Includes trust preferred capital
                 securities.
|--- | -------------------------------------------------------------
















|Year
                 Ended December 31
|---------------------------------------
|
|
|$ 
                  14,412            
|5,616                                  
|                                       
|18,851                                 
|2,648                                  
|4,881                                  
|                                       
|26,380                                 
|                                       
|76,636                                 
|56,410                                 
|22,880                                 
|                                       
|155,926                                
|202,334                                
|(2,751)                                
|30,299                                 
|                                       
|$229,882                               
|                                       
|                                       
|$22,408                                
|34,565                                 
|41,894                                 
|16,476                                 
|                                       
|115,343                                
|20,430                                 
|14,129                                 
|18,945                                 
|                                       
|168,847                                
|31,199                                 
|10,889                                 
|487                                    
|18,460                                 
|                                       
|$229,882                               
|                                       
|                                       
|                                       
|                                       
|                                       
|                                       




Analysis of Changes in Net Interest Income





The following
               table shows the approximate effect on net interest income of
               volume and rate changes for 1999 and 1998. For purposes of this
               table, changes that are not due solely to volume or rate changes
               are allocated to volume.





|                                                                                                                                                    |  | 1999
                 over 1998 |   | 1998
                 over 1997
|--------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------- | - | -------------------------------
|
|Increase (decrease) in interest income                                                                                                             
|Short-term investments                                                                                                                              |  | $
                       (32    | ) |                                
|Trading
                 assets                                                                                                                     |  | (5                              | ) |                                
|Investment securities                                                                                                                              
|U.S.
                 government and federal agency                                                                                                 |  | (96                             | ) |                                
|States
                 and political subdivisions                                                                                                  |  | (28                             | ) |                                
|Other                                                                                                                                               |  | 1,030                           |   |                                
|Loans                                                                                                                                              
|Commercial                                                                                                                                          |  | 609                             |   |                                
|Consumer                                                                                                                                            |  | 193                             |   |                                
|Credit
                 card                                                                                                                        |  | (1,322                          | ) |                                
|                                                                                                                                                    |  |                                 |   |                                
|Total                                                                                                                                               |  |                                 |   |                                
|Increase (decrease) in interest expense                                                                                                            
|Deposits                                                                                                                                           
|Savings                                                                                                                                             |  | (13                             | ) |                                
|Money
                 market                                                                                                                       |  | 181                             |   |                                
|Time                                                                                                                                                |  | (152                            | ) |                                
|Foreign
                 offices                                                                                                                    |  | 261                             |   |                                
|Federal
                 funds purchased and securities under
               
                         
                      repurchase agreements |  | (94                             | ) |                                
|Other
                 short-term borrowings                                                                                                        |  | 215                             |   |                                
|Long-term debt                                                                                                                                      |  | 432                             |   |                                
|                                                                                                                                                    |  |                                 |   |                                
|Total                                                                                                                                               |  |                                 |   |                                
|                                                                                                                                                    |  |                                 |   |                                
|Increase (decrease) in net interest income                                                                                                          |  |                                 |   |                                
|                                                                                                                                                    |  |                                 |   |                                




PART
               I





Item 1. Business





DESCRIPTION OF BUSINESS





GENERAL





BANK ONE
               CORPORATION (the Corporation) is a multibank holding
               company registered under the Bank Holding Company Act of 1956
               (the BHC Act), and is headquartered in Chicago,
               Illinois. The Corporation was incorporated in Delaware on April
               9, 1998, to effect the merger (the Merger) of BANC
               ONE CORPORATION (Banc One), an Ohio corporation and
               registered bank holding company, and First Chicago NBD
               Corporation (FCN), a Delaware corporation and
               registered bank holding company. The Merger became effective on
               October 2, 1998.





Through its bank
               subsidiaries (collectively, the Banks), the
               Corporation provides domestic retail banking, finance and credit
               card services; worldwide commercial banking services; and trust
               and investment management services. The Corporation operates
               banking offices in Arizona, Colorado, Florida, Illinois,
               Indiana, Kentucky, Louisiana, Michigan, Ohio, Oklahoma, Texas,
               Utah, West Virginia and Wisconsin. The Corporation also owns
               nonbank subsidiaries that engage in businesses related to
               banking and finance, including credit card and merchant
               processing, consumer and education finance, mortgage lending and
               servicing, insurance, venture capital, investment and merchant
               banking, trust, brokerage, investment management, leasing,
               community development and data processing.





Like its
               predecessors, the Corporation continually evaluates its business
               operations and organizational structures, and routinely explores
               opportunities to (i) acquire financial institutions and other
               financial services-related businesses or assets, and (ii) enter
               into strategic alliances to expand the scope of its services and
               its customer base. When consistent with its overall business
               strategy, the Corporation also will sell assets or exit certain
               businesses or markets. In 1999, the Corporation undertook
               several initiatives to combine operations under a single
               identity. In May, the Corporation introduced the Bank One name
               at former FCN locations in Michigan and Florida. The Corporation
               integrated former FCN Indiana branches with Banc One banking
               centers in June. In September, substantially all Chicago
               metropolitan-area banking operations were integrated under the
               Bank One name.





LINES OF
             BUSINESS





The Corporation
               engages primarily in four lines of businessCommercial
               Banking, Credit Card, Retail Banking and Investment Management
               as well as proprietary investment activities.





Commercial Banking





Commercial
               Banking provides a broad range of corporate financial products
               to large and mid-sized corporations, financial institutions,
               governmental entities and nonprofit organizations. The
               Corporation is one of the leading commercial banking
               organizations in the United States, ranking as the number-one
               commercial and middle market bank in the Midwest, and the
               number-three commercial bank in the United States.





One of the
               Corporations subsidiaries, Banc One Capital Markets, Inc.,
               is a primary government bond dealer and is principally
               responsible for syndicating bank loans and for activities in the
               following types of securities: corporate, asset-backed,
               municipal and United States government agency securities.
               Activities include trading, sales, underwriting, research, and
               maintaining an active secondary market with national sales
               distribution.





Through a number
               of its subsidiaries, the Corporation also develops, markets and
               delivers cash management, operating, clearing and other
               noncredit products and services, both overseas and domestically.
               These include money transfer, collection, disbursement,
               documentary, remittance, trade finance, real estate, mortgage
               specialized and lease financing services, and international
               securities clearing services.





Commercial
               Bankings customers include companies that have greater
               than $5 million in annual sales and are located in various
               geographic segments throughout the United States and the world.
               Commercial Banking specializes in creating custom banking
               solutions to meet the unique financial needs of companies within
               the financial services, health care, retailing, communications,
               energy and utilities, and auto industries.





Commercial
               Banking increasingly serves companies through its international
               product delivery system, which provides them the tools they need
               to prosper in global markets. This global approach to
               relationship management and customer service relies on a network
               of offices, branches, subsidiaries, affiliates and
               representative offices across the United States and in 10 other
               countries.





In addition, the
               Corporate Investments Group engages in proprietary investment
               activities through certain nonbank subsidiaries. These
               noncustomer-oriented activities include growth, tax-oriented and
               value investing. Growth equity investments include various forms
               of equity funding for acquisitions, management buyouts, growing
               businesses and small business ventures. Tax-oriented investment
               activities include investing in and advising on leases for
               commercial aircraft, and major industrial and power production
               facilities and equipment. Investments also are made in
               alternative energy programs and affordable housing projects
               qualifying for tax credits under federal tax laws.
               Value-oriented investments include positions in value investment
               markets, such as loans, trade claims and securities of
               distressed companies. Such activities also include investing in
               securities of companies whose debt trades below full face value
               of the claim, below-investment-grade tranches of commercial
               mortgage-backed securities, asset-backed securities,
               subordinated debt and other securities.





Credit
               Card





The Corporation
               s Credit Card operations extend nationwide and to Canada
               and the United Kingdom. A member of both the Visa® and
               MasterCard® associations, the Corporation issues credit
               cards primarily through its subsidiary, First USA Bank, National
               Association (First USA). At December 31, 1999,
               Credit Card had more than 64 million cardmembers and managed
               credit card receivables of approximately $69.4
               billion.





WingspanBank.com
               is the interactive banking and financial management website
               launched by the Corporation in June 1999. WingspanBank.com
               provides consumers with a wide range of financial products and
               services, including traditional banking, investment and
               financial planning services, and objective search
               tools.





Retail
               Banking





Retail Banking
               provides a comprehensive suite of financial products and
               services to individuals and small business customers, primarily
               in 14 states. The Corporation holds a number-one or number-two
               market share in nearly 70% of the markets in which it maintains
               a physical presence. The Retail Group has three components: 1)
               Customer Segmentsincluding mass market, premier and
               business; 2) Distribution Channelsfive distinct channels,
               including more than 1,800 banking centers, dedicated
               relationship managers, more than 7,000 automated teller machines
               (ATMs), 24-hour telephone banking centers, and an
               online financial supersite (www.bankone.com); and 3) Product
               Groupsincluding depository, loan and related financial
               products. The recent inclusion of indirect auto lending and
               consumer lending into Retail Banking creates the equivalent of a
               full-service retail bank with opportunities to deliver
               integrated solutions across a wide range of consumer activities.
               The newly defined Retail Group is the third-largest retail
               banking distribution system in the country, the third-largest
               lender to small businesses, the third-largest bank lender of
               home equity products and the fifth-largest indirect auto lender.
               In addition, THE ONE Card SM  , issued
               through Retail Banking, is one of the countrys leading
               debit cards for individuals.





Investment Management





The Investment
               Management Group provides investment, insurance, trust and
               private banking services to individuals and institutions. The
               Group also provides investment-related services, including
               retirement and custody services, securities lending and
               corporate trust. Banc One Investment Advisors Corporation (
               Banc One
             Investment Advisors), the Investment Management Groups
               registered investment advisory arm, ranks among the nation
               s top 30 asset managers, with approximately $130 billion
               in assets under management. In addition, Banc One Investment
               Advisors manages the One Group® Mutual Funds, the
               25th-largest mutual fund complex in the country and the
               fourth-largest bank-owned mutual fund family, with more than $64
               billion in assets under management.





RISK
             MANAGEMENT
             GOVERNANCE





The Corporation
               s risk management processes are governed by a
               decision-making hierarchy that elevates key strategic and policy
               decisions to higher authorities. The highest decision-making
               committee within the hierarchy (excluding committees of the
               Board of Directors) is the Executive Risk Management Committee,
               which determines the Corporations risk/return profiles.
               This committee includes, among others, the President, the Vice
               Chairman, the Chief Risk Management Officer and the Chief
               Financial Officer.





The Executive
               Risk Management Committee is supported by the Commercial Banking
               Risk Management Committee, which approves material product risk
               and portfolio management initiatives for large corporate and
               middle market businesses; the Consumer Banking Risk Management
               Committee, which serves in a similar role for consumer lines of
               business; the Market and Investment Risk Management Committee,
               which approves policies for trading, investment and capital
               markets activities; and the Operating Risk Forum, which assesses
               operating risk issues for the Corporation.





EMPLOYEES





As of December
               31, 1999, the Corporation and its subsidiaries had 86,198
               employees on a full-time equivalent basis.





COMPETITION





The Corporation
               and its subsidiaries face active competition in all of their
               principal activities, not only from commercial banks, but also
               from savings and loan associations, credit unions, finance
               companies, mortgage companies, leasing companies, insurance
               companies, mutual funds, securities brokers and dealers, other
               domestic and foreign financial institutions, and various
               nonfinancial institutions. The Gramm-Leach-Bliley Act of 1999
               likely will intensify competition. Additional discussion of this
               legislation is included in the Supervision and Regulation
                section beginning on page 88.





MONETARY POLICY AND ECONOMIC CONTROLS





The earnings of
               the Banks, and therefore the earnings of the Corporation, are
               affected by the policies of regulatory authorities, including
               the Board of Governors of the Federal Reserve System (the
               Federal Reserve Board). An important function of the
               Federal Reserve Board is to promote orderly economic growth by
               influencing interest rates and the supply of money and credit.
               Among the methods that have been used to achieve this objective
               are open market operations in United States government
               securities, changes in the discount rate for member bank
               borrowings and changes in reserve requirements against bank
               deposits. These methods are used in varying combinations to
               influence overall growth and distribution of bank loans,
               investments and deposits, interest rates on loans and
               securities, and rates paid for deposits.





The Federal
               Reserve Boards monetary policies strongly influence the
               behavior of interest rates and can have a significant effect on
               the operating results of commercial banks. Robust economic
               growth and the restoration of more stability in global financial
               markets contributed to the decision of the Federal Reserve Board
               to increase short-term interest rates in 1999.





The effects of
               the various Federal Reserve Board policies on the future
               business and earnings of the Corporation cannot be predicted.
               Other economic controls also have affected the Corporation
               s operations in the past.
             The Corporation cannot predict the nature or extent of any effects
               that possible future governmental controls or legislation might
               have on its business and earnings.





SUPERVISION AND REGULATION





The following
               discussion sets forth certain material elements of the
               regulatory framework applicable to bank holding companies and
               their subsidiaries and provides certain specific information
               relevant to the Corporation. The regulatory framework is
               intended primarily to protect depositors and the federal deposit
               insurance funds and not security holders. To the extent that the
               following information describes statutory and regulatory
               provisions, it is qualified in its entirety by reference to
               those provisions. A change in the statutes, regulations or
               regulatory policies applicable to the Corporation or its
               subsidiaries may have a material effect on the business of the
               Corporation.





GENERAL





As a bank
               holding company, the Corporation is subject to regulation under
               the BHC Act, and to inspection, examination and supervision by
               the Federal Reserve Board. Under the BHC Act, bank holding
               companies (except those that have become financial holding
               companies as described below) generally may not own or
               control more than 5% of the voting shares or substantially all
               the assets of any company, including a bank, without the Federal
               Reserve Boards prior approval. In addition, bank holding
               companies (except those that have become financial holding
               companies) generally may engage, directly or indirectly,
               only in banking and such other activities as are determined by
               the Federal Reserve Board to be closely related to
               banking.





Various
               governmental requirements, including Sections 23A and 23B of the
               Federal Reserve Act, limit borrowing by the Corporation and its
               nonbank subsidiaries from the Banks. These requirements also
               limit various other transactions between the Corporation and its
               nonbank subsidiaries, on the one hand, and the Banks, on the
               other. For example, Section 23A limits to no more than 10% of
               any banks total capital the aggregate outstanding amount
               of the banks loans and other covered transactions
                with any particular nonbank affiliate, and limits to no
               more than 20% of its total capital the aggregate outstanding
               amount of any banks covered transactions with all of its
               nonbank affiliates. Section 23A also generally requires that a
               banks loans to its nonbank affiliates be secured, and
               Section 23B generally requires that a banks transactions
               with its nonbank affiliates be on arms-length
               terms.





Most of the
               Banks are national banking associations and, as such, are
               subject to regulation primarily by the Office of the Comptroller
               of the Currency (OCC) and, secondarily, by the
               Federal Deposit Insurance Corporation (FDIC) and the
               Federal Reserve Board. The Corporations state-chartered
               Banks are subject to regulation by the Federal Reserve Board and
               the FDIC and, in addition, by their respective state banking
               departments. The Banks operations in other countries are
               subject to various restrictions imposed by the laws of those
               countries.





GRAMM
             -LEACH
             -BLILEY
             ACT OF
             1999





The
               Gramm-Leach-Bliley Act of 1999 (the GLB Act)
               eliminates many legal barriers between banks and bank holding
               companies, on the one hand, and securities firms, insurance
               companies and other financial services providers, on the other.
               Among other things,the GLB Act repealed certain
               Glass-Steagall Act restrictions on affiliations between banks
               and securities firms, and amended the BHC Act to permit bank
               holding companies that qualify as financial holding
               companies (FHCs) to engage in activities, and
               acquire companies engaged in activities, that are (a) financial
               in nature; (b) incidental to financial activities; or (c)
               complementary to financial activities if the Federal Reserve
               Board determines that they pose no substantial risk to the
               safety or soundness of depository institutions or the financial
               system in general. The GLB Act treats various lending; insurance
               underwriting; insurance company portfolio investment; financial
               advisory; securities underwriting, dealing and market-making;
               and merchant banking activities as financial in nature for this
               purpose. The Federal Reserve Board, in consultation with the
               Secretary of the Treasury, may add to this list. The GLB Act not
               only permits bank holding
             companies to acquire securities and insurance firms, but also
               allows such firms to acquire banks and bank holding
               companies.





A bank holding
               company may become an FHC only if (a) all of its depository
               institution subsidiaries are well capitalized, (b) all of its
               depository institution subsidiaries are well managed, and (c)
               the bank holding company has filed with the Federal Reserve
               Board a declaration that the company elects to be an FHC. In
               addition, a bank holding company generally may not commence any
               new activity or acquire any additional company as an FHC if any
               of its depository institution subsidiaries has received a rating
               of less than satisfactory in its most recent
               examination under the Community Reinvestment Act of 1977 (
               CRA).





The GLB Act
               generally permits national banks to engage through special
               financial subsidiaries in the financial and other incidental
               activities authorized for FHCs by the Act. However, such
               financial subsidiaries may not engage in insurance or annuity
               underwriting, insurance company portfolio investments, real
               estate investment and development or, at least for the first
               five years after the GLB Acts enactment, merchant banking.
               Also, the national bank in question and all its depository
               institution affiliates must be well capitalized, well managed
               and have satisfactory CRA ratings, and there are limits on such
               a banks investments in such subsidiaries. With certain
               limited exceptions, a national banks dealings with its
               financial subsidiaries are subject to Sections 23A and 23B of
               the Federal Reserve Act. The Corporation has not yet determined
               whether or when it may elect to become an FHC or to establish a
               financial subsidiary.





The GLB Act also
               imposes new restrictions on financial institutions
               transfer and use of nonpublic personal information about their
               customers. Among other things, it directs the federal banking
               agencies to develop new regulations for this purpose; gives
               customers the right to opt out of having their
               nonpublic personal information shared with nonaffiliated third
               parties; bars financial institutions from disclosing customer
               account numbers or other such access codes to nonaffiliated
               third parties for direct marketing purposes; and requires annual
               disclosure by financial institutions of their policies and
               procedures for protecting customers nonpublic personal
               information.





LIABILITY FOR
             BANK
             SUBSIDIARIES





The Federal
               Reserve Board has adopted a policy stating that a bank holding
               company is expected to act as a source of financial and
               managerial strength to each of its subsidiary banks and to
               maintain resources adequate to support each such subsidiary
               bank. This support may be required at times when the Corporation
               may not have the resources to provide it. In addition, Section
               55 of the National Bank Act permits the OCC to order the pro
               rata assessment of shareholders of a national bank whose capital
               has become impaired. If a shareholder fails within three months
               to pay such an assessment, the OCC can order the sale of the
               shareholders stock to cover the deficiency. In the event
               of a bank holding companys bankruptcy, any commitment by
               the bank holding company to a federal bank regulatory agency to
               maintain the capital of a subsidiary bank would be assumed by
               the bankruptcy trustee and entitled to priority of
               payment.





Under the terms
               of the Federal Deposit Insurance Act, the FDIC can hold any
               FDIC-insured depository institution liable for any loss the FDIC
               incurs, or reasonably expects to incur, in connection with (a)
               the default of any commonly controlled FDIC-insured
               depository institution or (b) any assistance provided by the
               FDIC to any commonly controlled depository institution that is
               in danger of default. An institution is deemed in
               default, for this purpose, if it is placed in
               conservatorship or receivership, and in danger of default
                if a default is likely to occur absent
               regulatory assistance. All of the Banks are FDIC-insured
               depository institutions.





CAPITAL
             REQUIREMENTS





The Corporation
               is subject to capital requirements and guidelines imposed on
               bank holding companies by the Federal Reserve Board. The OCC,
               the FDIC and the Federal Reserve Board impose similar
               requirements and guidelines on the Banks within their respective
               jurisdictions. These capital requirements establish higher
               capital standards for banks and bank holding companies that
               assume greater risks. For this purpose, a bank holding
             companys or banks assets and certain specified
               off-balance sheet commitments are assigned to four risk
               categories, each weighted differently based on the level of
               credit risk that is ascribed to such assets or commitments. A
               bank holding companys or banks total capital, in
               turn, is divided into three tiers: core (Tier 1)
               capital, which includes common equity, certain qualifying
               cumulative and noncumulative perpetual preferred stock and
               related surplus, and minority interests in equity accounts of
               consolidated subsidiaries; supplementary (Tier 2)
               capital, which includes perpetual preferred stock and related
               surplus not meeting the Tier 1 definition, hybrid capital
               instruments, perpetual debt and mandatory convertible
               securities, subordinated debt, intermediate-term preferred
               stock, and allowances for loan and lease losses; and market risk
               (Tier 3) capital, which includes qualifying
               unsecured subordinated debt. Goodwill, certain identifiable
               intangible assets, and certain other assets must be deducted in
               calculating the sum of the core capital elements.





The Corporation,
               like other bank holding companies, is required to maintain Tier
               1 and total capital (the sum of Tier 1, Tier 2 and Tier 3
               capital) equal to at least 4% and 8% of its total risk-weighted
               assets, respectively. At December 31, 1999, the Corporation met
               both requirements, with Tier 1 and total capital equal to 7.7%
               and 10.7% of its total risk-weighted assets, respectively. Each
               of the Banks was in compliance with its applicable minimum
               capital requirement at December 31, 1999.





The Federal
               Reserve Board, the FDIC and the OCC have adopted rules to
               incorporate market and interest-rate risk components into their
               risk-based capital standards. Under these market risk
               requirements, capital is allocated to support the amount of
               market risk related to a financial institutions ongoing
               trading activities.





The Federal
               Reserve Board also requires bank holding companies to maintain a
               minimum leverage ratio (Tier 1 capital to adjusted
               average assets). The guidelines provide for a minimum leverage
               ratio of 3% for bank holding companies that have the highest
               regulatory rating or have implemented the risk-based capital
               measures for market risk, or 4% for holding companies that do
               not meet either of these requirements. Each of the Banks is
               subject to similar requirements adopted by the applicable
               federal regulatory agency. At December 31, 1999, the Corporation
               s leverage ratio was 7.7%. Each of the Banks was in
               compliance with its applicable leverage ratio requirement as of
               December 31, 1999.





Each federal
               banking regulator may set capital requirements higher than the
               minimums noted above for holding companies or institutions whose
               circumstances warrant it. For example, institutions experiencing
               or anticipating significant growth may be expected to maintain
               capital ratios, including tangible capital positions, well above
               the minimum levels. Furthermore, the Federal Reserve Board has
               indicated that it will consider a tangible Tier 1 capital
               leverage ratio (deducting all intangibles) and other
               measures of capital strength in evaluating proposals for
               expansion or new activities. No federal banking regulator has,
               however, imposed any such special capital requirement on the
               Corporation or the Banks.





Failure to meet
               capital requirements could subject a bank to a variety of
               enforcement remedies, including the termination of deposit
               insurance by the FDIC, and to certain restrictions on its
               business, which are described below.





The Federal
               Deposit Insurance Corporation Improvement Act of 1991 (
               FDICIA), among other things, identifies five capital
               categories for insured depository institutions (well
               capitalized, adequately capitalized, undercapitalized,
               significantly undercapitalized and critically undercapitalized),
               and requires the respective federal bank regulatory agencies to
               implement systems for prompt corrective action for
               insured depository institutions that do not meet minimum capital
               requirements, based on these categories. FDICIA imposes
               progressively more restrictive constraints on operations,
               management and capital distributions depending on the category
               in which an institution is classified. Some of the consequences
               of a banks failure to be well capitalized are described in
               this discussion. Failure to meet the capital guidelines could
               also subject a depository institution to capital raising
               requirements. An undercapitalized depository
               institution must develop a capital restoration plan, and its
               parent holding company must guarantee that banks
               compliance with the plan. The liability of the parent holding
               company under any such guarantee is limited to the lesser of 5%
               of the depository institutions assets at the time
             it became undercapitalized or the amount needed to
               comply with the plan. Furthermore, in the event of the
               bankruptcy of the parent holding company, such guarantee would
               take priority over the parents general unsecured
               creditors. In addition, FDICIA requires the federal bank
               regulatory agencies to prescribe certain non-capital standards
               for safety and soundness relating generally to operations and
               management, asset quality and executive compensation, and it
               permits regulatory action against a financial institution that
               does not meet such standards.





As of December
               31, 1999, each Bank was well capitalized, based on
               the prompt corrective action ratios and guidelines
               described above. It should be noted, however, that a Banks
               capital category is determined solely for the purpose of
               applying the federal banking agencies prompt
               corrective action regulations; the capital category may
               not constitute an accurate representation of the Banks
               overall financial condition or prospects.





DIVIDEND
             RESTRICTIONS





Various
               provisions of federal and state law limit the amount of
               dividends the Banks can pay to the Corporation without
               regulatory approval. For example, approval generally is required
               for any national bank, or any state-chartered bank that is a
               member of the Federal Reserve System, to pay any dividend that
               would cause the banks total dividends paid during any
               calendar year to exceed the sum of the banks net income
               during such calendar year plus the banks retained net
               income for the prior two calendar years. Such a bank also
               generally may not pay any dividend exceeding its undivided
               profits then on hand without regulatory approval. At January 1,
               2000, $2.5 billion of total stockholders equity of the
               Banks was available for payment of dividends to the Corporation
               without approval by the applicable regulatory
               authority.





In addition,
               federal bank regulatory agencies have authority to prohibit the
               Banks from engaging in unsafe or unsound practices in conducting
               their business. The payment of dividends, depending upon the
               financial condition of the bank in question, could be deemed to
               constitute an unsafe or unsound practice. The ability of the
               Banks to pay dividends in the future is currently, and could be
               further, influenced by bank regulatory policies and capital
               guidelines.





DEPOSIT
             INSURANCE
             ASSESSMENTS





The domestic
               deposits of each Bank are insured up to regulatory limits by the
               FDIC and, accordingly, are subject to deposit assessments to
               maintain the Bank Insurance Fund (BIF) and the
               Savings Association Insurance Fund (SAIF)
               administered by the FDIC. The FDIC has adopted regulations
               establishing a permanent risk-related deposit insurance
               assessment system. Under this system, the FDIC places each
               insured institution in one of nine risk categories based on (a)
               the institutions capitalization and (b) supervisory
               evaluations provided to the FDIC by the institutions
               primary federal regulator. Each insured institutions
               deposit insurance assessment rate is then determined by the risk
               category in which it is classified.





For the current
               assessment period, the annual insurance premiums on both BIF-
               and SAIF-assessable deposits vary from $0.00 per $100 of
               deposits, for institutions classified in the highest capital and
               supervisory evaluation categories, to $0.27 per $100 of
               deposits, for institutions classified in the lowest capital and
               supervisory evaluation categories. The Banks held approximately
               $10.3 billion of SAIF-assessable deposits as of December 31,
               1999; the remainder of the Banks domestic deposits are
               BIF-assessable.





The Deposit
               Insurance Funds Act of 1996 provides for additional assessments
               on BIF- and SAIF-assessable deposits to pay for the cost of
               Financing Corporation (FICO) funding. For the first
               quarter of 2000, the FDICs annual FICO assessment rates
               were $0.0212 per $100 of deposits for both BIF- and
               SAIF-assessable deposits. FICO assessments do not vary depending
               upon a depository institutions capitalization or
               supervisory evaluations.





DEPOSITOR
             PREFERENCE
             STATUTE





Federal
               legislation has been enacted providing that deposits and certain
               claims for administrative expenses and employee compensation
               against an insured depository institution would be afforded a
               priority over other general unsecured claims against such
               institution, including federal funds and letters of credit, in
               the liquidation or other resolution of the institution by any
               receiver.





BROKERED
             DEPOSITS





Under FDIC
               regulations, no FDIC-insured depository institution can accept
               brokered deposits unless it (a) is well capitalized, or (b) is
               adequately capitalized and receives a waiver from the FDIC. In
               addition, these regulations prohibit any depository institution
               that is not well capitalized from (i) paying an interest rate on
               deposits that is more than 75 basis points over certain
               prevailing market rates, or (ii) offering pass through
                deposit insurance on certain employee benefit plan
               accounts unless it provides certain notice to affected
               depositors.





INTERSTATE
             BANKING





Under the
               Riegle-Neal Interstate Banking and Branching Efficiency Act of
               1994 (Riegle-Neal), subject to certain concentration
               limits and other requirements, (a) bank holding companies such
               as the Corporation are permitted to acquire banks and bank
               holding companies located in any state; (b) any bank that is a
               subsidiary of a bank holding company is permitted to receive
               deposits, renew time deposits, close loans, service loans and
               receive loan payments as an agent for any other bank subsidiary
               of the holding company, and (c) banks are permitted to acquire
               branch offices outside their home states by merging with
               out-of-state banks, purchasing branches in other states, and
               establishing de novo branch offices in other states
               provided that, in the case of any such purchase or de novo
               branch, the host state has adopted legislation opting in
                to those provisions of Riegle-Neal; and, provided that,
               in the case of a merger with a bank located in another state,
               neither of the two states involved has adopted legislation
               opting out of that provision of Riegle-Neal. The
               Corporation might use its authority under Riegle-Neal to acquire
               banks in additional states and to consolidate its current bank
               subsidiaries across state lines.





OTHER





The Corporation
               s nonbank subsidiaries and banking-related business units
               are subject to regulation by various state and federal
               regulatory agencies and self-regulatory organizations.
               Activities subject to such regulation include investment
               management, investment advisory services, commodities and
               securities brokerage, insurance services and products,
               securities dealing and transfer agency services.





FINANCIAL REVIEW





See pages 2
               through 84.





Item 2. Properties





The Corporation
               s headquarters are in Chicago, Illinois. The 60-story
               building, located in the center of the Chicago Loop
               business district, is master-leased and has 1,750,000 square
               feet of space, of which the Corporation occupies approximately
               57%; the balance is subleased to other tenants.





The Corporation
               and its subsidiaries occupy more than 3,000 owned or leased
               domestic properties, including banking centers, operations
               facilities and commercial banking offices. In addition, the
               Corporation has foreign offices in major cities in Canada,
               Mexico, Europe, Asia and Australia. These offices all are
               located in leased premises.





Item 3. Legal Proceedings





The information
               required by this Item is set forth in Note 25 to the
               Consolidated Financial Statements on page 71 of this Form 10-K,
               and is expressly incorporated herein by reference.





Item 4. Submission of Matters to a Vote of Security
               Holders





None.





EXECUTIVE
             OFFICERS OF THE
             REGISTRANT





|Name
                 and Age                |  | Current Position Held with the Corporation and
               
               Effective Date First Elected to Office Indicated
|-------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------
|Verne
                 G. Istock (59)        |  | Director, Acting Chief Executive Officer (12/21/99) and
                 President
               
               (10/19/99)  
|William
                 P. Boardman (58)    |  | Director and Vice Chairman of the Board
                 (12/21/99)                                                           
|Marvin
                 W. Adams (42)        |  | Executive Vice President (12/15/98) and Chief
                 Technology Officer
               
               (10/2/98)    
|David
                 P. Bolger (42)        |  | Executive Vice President (4/20/99)                                                                                            
|W. G.
                 Jurgensen (48)        |  | Executive Vice President (12/15/98)                                                                                           
|David
                 J. Kundert (57)       |  | Executive Vice President (12/15/98)                                                                                           
|Timothy
                 P. Moen (47)        |  | Executive Vice President (12/15/98)                                                                                           
|Susan
                 S. Moody (46)         |  | Executive Vice President (12/15/98)                                                                                           
|Robert
                 A. ONeill, Jr. (46) |  | Executive Vice President and General Auditor
                 (1/19/99)                                                       
|Robert
                 A. Rosholt (50)      |  | Executive Vice President (12/15/98) and Chief Financial
                 Officer (10/2/98)                                    
|Kenneth
                 T. Stevens (48)     |  | Executive Vice President (12/15/98)                                                                                           
|Geoffrey L. Stringer (56)                    |  | Executive Vice President (5/18/99)                                                                                            
|Richard
                 R. Wade (47)        |  | Executive Vice President (12/15/98)                                                                                           




Except for Mr.
               Stevens, each of the executive officers has served as an officer
               of the Corporation or a subsidiary, or their respective
               predecessors, for more than five years. Mr. Stevens joined Banc
               One as Chairman and Chief Executive Officer of the Retail Group
               in 1996. Prior to joining Banc One, Mr. Stevens served as
               President and Chief Operating Officer (19941996) and
               Executive Vice President (19931994) of Taco Bell
               Corporation. Prior to that time, Mr. Stevens served as Senior
               Vice President and Treasurer (19921993) and Senior Vice
               President, Strategic Planning, of PepsiCo, Inc.





Executive
               officers of the Corporation serve until the annual meeting of
               the Board of Directors (May 16, 2000).





PART
               II





Item 5. Market for Registrants Common Equity and Related
               Stockholder Matters





The information
               required by this Item is set forth in this Form 10-K in the
               Common Stock and Stockholder Data table on page 79
               and the Quarterly Financial Data table on page 81,
               and is expressly incorporated herein by reference.





Item 6. Selected Financial Data





The information
               required by this Item is set forth in this Form 10-K in the
               Selected Financial Data table on page 2 and the
               Financial Ratios table on page 80, and is expressly
               incorporated herein by reference.





Item 7. Managements Discussion and Analysis of Financial
               Condition and Results of Operations





The information
               required by this Item is set forth on pages 237 of this
               Form 10-K, and is expressly incorporated herein by
               reference.





Item 7A. Quantitative and Qualitative Disclosures About Market
               Risk





The information
               required by this Item is set forth on pages 1721 of this
               Form 10-K, and is expressly incorporated herein by this
               reference.





Item 8. Financial Statements and Supplementary
               Data





The information
               required by this Item is set forth in this Form 10-K in the
               Selected Financial Data table on page 2, the
               Selected Statistical Information table on page 22,
               the Loan Composition table on page 22, the
               Consolidated Financial Statements and the Notes thereto on pages
               3873, the Report of Independent Public Accountants
                on page 74 and the Selected Statistical Information
                section on pages 7584, and is expressly
               incorporated herein by reference.





Item 9. Changes in and Disagreements with Accountants on
               Accounting and Financial Disclosure





The information
               required by this item has been previously reported in Banc One
               s Current Report on Form 8-K dated July 24, 1998, and is
               expressly incorporated herein by reference.





PART
               III





Item 10. Directors and Executive Officers of the
               Registrant





The information
               required by this Item pertaining to executive officers of the
               Corporation is set forth on page 93 of this Form 10-K under the
               heading Executive Officers of the Registrant, and is
               expressly incorporated herein by reference. The information
               required by this Item pertaining to directors of the Corporation
               and to compliance with Section 16(a) of the Securities Exchange
               Act of 1934 is set forth under the headings Election of
               Directors and Section 16(a) Beneficial Ownership
               Reporting Compliance, respectively, in the Corporation
               s definitive proxy statement dated March 27, 2000, and is
               expressly incorporated herein by reference.





Item 11. Executive Compensation





The information
               required by this Item is set forth under the headings
               Compensation of Executive Officers, Director
               Meeting Attendance and Fee Arrangements and
               Committees of the Board of DirectorsOrganization,
               Compensation and Nominating CommitteeCommittee Interlocks
               and Insider Participation in the Corporations
               definitive proxy statement dated March 27, 2000, and is
               expressly incorporated herein by reference.





Item 12. Security Ownership of Certain Beneficial Owners and
               Management





The information
               required by this Item is set forth under the heading
               Beneficial Ownership of the Corporations Common Stock
                in the Corporations definitive proxy statement
               dated March 27, 2000, and is expressly incorporated herein by
               reference.





Item 13. Certain Relationships and Related
               Transactions





The information
               required by this Item is set forth under the headings
               Committees of the Board of Directors Organization,
               Compensation and Nominating CommitteeCommittee Interlocks
               and Insider Participation and Transactions with
               Directors, Executive Officers, Stockholders and Associates
               in the Corporations definitive proxy statement dated March
               27, 2000, and is expressly incorporated herein by
               reference.





PART
               IV





Item 14. Exhibits, Financial Statement Schedules and Reports on
               Form 8-K





(a) (1)
               Financial Statements:





|                                                                                                     |  | Page
|---------------------------------------------------------------------------------------------------- |  | ----
|Consolidated Balance SheetDecember 31, 1999 and
                 1998                               |  | 38  
|Consolidated Income StatementThree Years Ended
                 December 31, 1999                   |  | 39  
|Consolidated Statement of Stockholders Equity
                 Three Years Ended December 31, 1999 |  | 40  
|Consolidated Statement of Cash FlowsThree Years
                 Ended December 31, 1999            |  | 41  
|Notes
                 to Financial Statements                                                       |  | 42  




(2) Financial
               Statement Schedules.





All schedules
               normally required by Form 10-K are omitted, since either they
               are not applicable or the required information is shown in the
               financial statements or the notes thereto.





(3)
               Exhibits.





|3(A).  |  | Restated Certificate of Incorporation of the
                 Corporation, as amended [Exhibit 3(A) to the
               
               Corporations 1998 Annual Report on Form 10-K (File No.
                 333-60313) incorporated
               
               herein by reference].                                                                                                                                                                       
|------ |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3(B).  |  | By-Laws
                 of the Corporation, as amended.                                                                                                                                                                                                                                                                                                                                                                                                              
|4.     |  | Instruments defining the rights of security holders,
                 including indentures.                                                                                                                                                                                                                                                                                                                                                                          
|10(A). |  | Agreement and Plan of Reorganization, dated as of April
                 10, 1998, by and among BANC
               
               ONE CORPORATION, First Chicago NBD Corporation and BANK ONE
                 CORPO-
               
               RATION, as amended [Exhibit 10(A) to the Corporations 1998
                 Annual Report on Form
               
               10-K (File No. 333-60313) incorporated herein by
                 reference].
|10(B). |  | BANK
                 ONE CORPORATION Stock Performance Plan.*                                                                                                                                                                                                                                                                                                                                                                                                        
|10(C). |  | BANK
                 ONE CORPORATION Director Stock Plan.*                                                                                                                                                                                                                                                                                                                                                                                                           
|10(D). |  | BANK
                 ONE CORPORATION Supplemental Executive Retirement
                 Plan.*                                                                                                                                                                                                                                                                                                                                                                       
|10(E). |  | BANK
                 ONE CORPORATION Deferred Compensation Plan.*                                                                                                                                                                                                                                                                                                                                                                                                    
|10(F). |  | BANK
                 ONE CORPORATION Supplemental Savings and Investment
                 Plan.*                                                                                                                                                                                                                                                                                                                                                                     




|10(G).   |  | BANK
                 ONE CORPORATION Supplemental Personal Pension Account
                 Plan.*                                                    
|-------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------
|10(H-1). |  | Form of
                 BANK ONE CORPORATION Individual Change of Control Employment
               
               Agreement (former FCN employees).*

|10(H-2). |  | Form of
                 BANK ONE CORPORATION Individual Change of Control Employment
               
               Agreement (former Banc One employees).*                                                                                                                                                         
|-------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10(I).   |  | Form of
                 BANK ONE CORPORATION Executive Management Separation
                 Plan.*                                                                                                                                                                                                                
|10(J).   |  | BANK
                 ONE CORPORATION Executive Management Annual Incentive
                 Plan.*                                                                                                                                                                                                                  
|10(K).   |  | BANK
                 ONE CORPORATION Investment Option Plan.*                                                                                                                                                                                                                                                       
|10(L).   |  | BANK
                 ONE CORPORATION Executive Life Insurance Plan.*                                                                                                                                                                                                                                                
|10(M).   |  | First
                 Chicago NBD Corporation Plan for Deferring the Payment of
                 Directors Fees [Exhibit
               
               10(D) to FCNs 1995 Annual Report on Form 10-K (File No.
                 1-7127) incorporated herein
               
               by reference].*       
|10(N).   |  | Form of
                 First Chicago NBD Corporation Executive Estate Plan [Exhibit
                 10(C) to FCNs
               
               1997 Annual Report on Form 10-K (File No. 1-7127) incorporated
                 herein by reference].*                                                          
|10(O).   |  | First
                 Chicago NBD Corporation Financial Planning Program for
                 Executives [Exhibit 10(D)
               
               to FCNs 1996 Annual Report on Form 10-K (File No. 1-7127)
                 incorporated herein by
               
               reference].*               
|10(P).   |  | First
                 Chicago NBD Corporation Long-Term Disability Restoration Plan
                 [Exhibit 10(F) to
               
               FCNs 1996 Annual Report on Form 10-K (File No. 1-7127)
                 incorporated herein by
               
               reference].*                   
|10(Q).   |  | First
                 Chicago Corporation Stock Incentive Plan [Exhibit 10(P) to the
                 Corporations 1998
               
               Annual Report on Form 10-K (File No. 333-60313) incorporated
                 herein by reference].*                                                        
|10(R).   |  | NBD
                 Bancorp, Inc. Performance Incentive Plan, as amended [Exhibit
                 10(Q) to the Cor-
               
               porations 1998 Annual Report on Form 10-K (File No.
                 333-60313) incorporated herein
               
               by reference].*             
|10(S).   |  | NBD
                 Bancorp, Inc. Benefit Protection Trust Agreement [Exhibit
                 10(Q) to FCNs 1996
               
               Annual Report on Form 10-K (File No. 1-7127) incorporated herein
                 by reference].*                                                                 
|10(T).   |  | BANC
                 ONE CORPORATION Amended and Restated Dividend Equivalent Unit
                 Plan
               
               [Exhibit 10(U) to the Corporations 1998 Annual Report on
                 Form 10-K (File No.
               
               333-60313) incorporated herein by reference].*
|10(U).   |  | Amended
                 and Restated BANC ONE CORPORATION Directors Deferred Compensa-
               
               tion Plan [Exhibit 10(Y) to the Corporations 1998 Annual
                 Report on Form 10-K (File No.
               
               333-60313) incorporated herein by reference].*        
|10(V).   |  | Revised
                 and Restated BANC ONE CORPORATION 1989 Stock Incentive Plan
               
               [Exhibit 10.8 to BANC ONEs 1997 Annual Report on Form 10-K
                 (File No. 1-8552)
               
               incorporated herein by reference].*                                
|10(W).   |  | Revised
                 and Restated BANC ONE CORPORATION 1995 Stock Incentive Plan
               
               [Exhibit 10(Z) to the Corporations 1998 Annual Report on
                 Form 10-K (File No.
               
               333-60313) incorporated herein by reference].*                     
|10(X).   |  | Description of BANC ONE CORPORATION 1997 Special
                 Recognition Awards
               
               Program [Exhibit 10.16 to BANC ONEs 1997 Annual Report on
                 Form 10-K (File No.
               
               1-8552) incorporated herein by reference].*                     
|10(Y).   |  | American Fletcher Corporation Deferred Compensation
                 Plan [Exhibit 10(QQ) to the Cor-
               
               porations 1998 Annual Report on Form 10-K (File No.
                 333-60313) incorporated herein
               
               by reference].*                             




|10(Z).  |  | Agreement dated December 21, 1999, between BANK ONE
                 CORPORATION and John
               
               B. McCoy.*  
|------- |  | -------------------------------------------------------------------------------------------------------------------------------------
|10(AA). |  | Agreement dated March 1, 2000, between BANK ONE
                 CORPORATION and William
               
               P. Boardman.*
|12.     |  | Statements re computation of ratios.                                                                                                 
|21.     |  | Subsidiaries of the Corporation.                                                                                                     
|23.     |  | Consents of experts and counsel.                                                                                                     
|27.     |  | Financial Data Schedule.                                                                                                             




(b) The
               Corporation filed the following Current Reports on Form 8-K
               during the quarter ended December 31, 1999:





|Date                              |  | Item
                 Reported                                                                                                                                 
|--------------------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------
|October
                 19, 1999 |  | Announcement of third quarter 1999 earnings and certain
                 management
               
               and organizational changes.                 
|November 10, 1999                 |  | Announcement of revised 1999 operating earnings outlook
                 and
               
               postponement of November 15, 1999, investor update.
|December 21, 1999                 |  | Announcement of senior management and board of
                 directors changes.                                                                             




 The
               Corporation hereby agrees to furnish to the Commission upon
               request copies of instruments defining the rights of holders of
               long-term debt of the Corporation and its consolidated
               subsidiaries; the total amount of such debt does not exceed 10%
               of the total assets of the Corporation and its subsidiaries on a
               consolidated basis.


* Management
               contract or compensatory plan or arrangement required to be
               filed as an exhibit to this Form 10-K.





SIGNATURES





Pursuant to
               the requirements of Section 13 or 15(d) of the Securities
               Exchange Act of 1934, the Corporation has duly caused this
               report to be signed on its behalf by the undersigned, thereunto
               duly authorized, this 15th day of February,
               2000.





| | BANK
                 ONE CORPORATION
| | -------------------------------------

| | (Registrant)
| | ------------






| | By:
                   /S
               /    VERNE
               G. ISTOCK
| | ----------------------------------------------------------------------------

| | Verne
                 G. Istock
| | --------------------------------

| | Principal Executive Officer
| | ---------------------------




Pursuant to
               the requirements of the Securities Exchange Act of 1934, this
               report has been signed below by the following persons on behalf
               of the Corporation and in the capacities indicated, this 15th
               day of February, 2000.





|/S
               /    WILLIAM
               P. BOARDMAN
               
               William
                 P. Boardman
               Director
               
               /S
               /    JOHN
               H. BRYAN
               
               John H.
                 Bryan
               Director
               
               /S
               /    SIEGFRIED
               BUSCHMANN
               
               Siegfried Buschmann
               Director
               
               /S
               /    JAMES
               S. CROWN
               
               James
                 S. Crown
               Director
               
               /S
               /    BENNETT
               DORRANCE
               
               Bennett
                 Dorrance
               Director
               
               /S
               /    MAUREEN
               A. FAY
               
               Maureen
                 A. Fay
               Director
               
               /S
               /    JOHN
               R. HALL
               
               John R.
                 Hall
               Director
               
               /S
               /    VERNE
               G. ISTOCK
               
               Verne
                 G. Istock
               Director
               
               /S
               /    LABAN
               P. JACKSON
               , JR
               .
               
               Laban
                 P. Jackson, Jr.
               Director
               
               /S
               /    JOHN
               W. KESSLER
               
               John W.
                 Kessler
               Director
               
               /S
               /    RICHARD
               A. MANOOGIAN
               
               Richard
                 A. Manoogian
               Director |  | /S
               /    WILLIAM
               T. MC
               CORMICK
               , JR
               .
               
               William
                 T. McCormick, Jr.
               Director
               
               /S
               /    THOMAS
               E. REILLY
               , JR
               .
               
               Thomas
                 E. Reilly, Jr.
               Director
               
               /S
               /    JOHN
               W. ROGERS
               , JR
               .
               
               John W.
                 Rogers, Jr.
               Director
               
               /S
               /    THEKLA
               R. SHACKELFORD
               
               Thekla
                 R. Shackelford
               Director
               
               /S
               /    ALEX
               SHUMATE
               
               Alex
                 Shumate
               Director
               
               /S
               /    FREDERICK
               P. STRATTON
               , JR
               .
               
               Frederick P. Stratton, Jr.
               Director
               
               /S
               /    JOHN
               C. TOLLESON
               
               John C.
                 Tolleson
               Director
               
               /S
               /    ROBERT
               D. WALTER
               
               Robert
                 D. Walter
               Director
               
               /S
               /    ROBERT
               A. ROSHOLT
               
               Robert
                 A. Rosholt
               Principal Financial Officer
               
               /S
               /    WILLIAM
               J. ROBERTS
               
               William
                 J. Roberts
               Principal Accounting Officer | 
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |