Bank Shots Will Be Trickier

More merger mania in '98? Yes, but as stock prices soar, investing will get tougher

Rumors perhaps more than anything else propelled bank stocks forward in 1997, and there should be more of them in '98. "Rumors and whispers about bank stocks are pushing these stocks around every day," says Keefe, Bruyette & Wood Inc. banking analyst Hal Schroeder. Much of the talk turned out to be true, however. As of mid-December, more than 370 bank and thrift deals had been announced, with a total price tag of $93 billion. The average bank stock was up 50% in 1997, says Donaldson, Lufkin & Jenrette Inc. analyst Thomas K. Brown.

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