##
##
##
#.
##
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) March 10, 1994
FLEET FINANCIAL GROUP,INC.
(Exact name of registrant as specified in its charter)
RHODE ISLAND
(State or other jurisdiction of incorporation)
1-6366 05-0341324
(Commission File Number) (IRS Employer Identification No.)
50 Kennedy Plaza, Providence, Rhode Island 02903
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 401-278-5800
(Former name or former address, if changed since last report)
Page 1 of 6
Exhibit Index on Page 2
<PAGE>
Item 5. Other Events.
Pursuant to Form 8-K, General Instructions F,
Registrant hereby incorporates by reference the press
release attached hereto as Exhibit 28.
Item 7. Financial Statements and Other Exhibits.
Exhibit No. Description Page
Exhibit 28 Fleet Financial Group, 3
Inc. Press Release
dated March 10, 1994
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, as amended, the Registrant has duly caused this report
to be signed in its behalf by the undersigned hereunto duly
authorized.
FLEET FINANCIAL GROUP, INC.
Registrant
By /s/ William C. Mutterperl
William C. Mutterperl
Senior Vice President,
General Counsel and Secretary
Dated: March 10, 1994
##
##
##
#.
##
Robert W. Lougee, Jr. Media:
Vice President and Director Thomas L. Lavelle
Corporate Communications (401) 278-3003
(401) 278-5879
Bruce P. Crooks Investor:
(401) 278-6241 Judith B. Ragge
(401) 278-6444
Fleet Reengineering Program Identifies $350 Million
In Sustainable Profit Improvements;
Efficiency Ratio will be 55% by Mid-1995
Thousands of Employee-Generated Ideas Will be Implemented
Over 12 Months
Providence, RI, March 10, 1994: Fleet Financial Group, one
of the nation's largest bank holding companies, announced today
that its Board of Directors has approved a plan to
significantly restructure Fleet's Northeast banking operations
over the next 12 months "to enhance profitability and prepare
for future growth."
Terrence Murray, chairman and chief executive officer, said
the results of Fleet Focus '94, a seven-month reengineering
program that identified $350 million in sustainable profit
improvements, "will enable us to better control costs, make us
more competitive among industry leaders, and help us better
serve our customers."
When fully implemented, based on management's current
financial outlook, recommendations stemming from Fleet Focus
'94 will reduce overhead costs by $300 million annually and,
combined with annual revenue enhancements of approximately $50
million, will improve Fleet's efficiency ratio (the cost of
generating revenue) to approximately 55% by mid-1995, among the
most competitive in the financial services industry.
Fleet's efficiency ratio was 67% in the second quarter of
1993. The full effect of implementation will be realized by
the second quarter of 1995.
Implementation of Fleet Focus '94 recommendations will mark
the culmination of a successful strategic effort by Fleet since
1990 to improve its competitive strength. In that time, Fleet
has successfully improved its liquidity, improved credit
quality by reducing nonperforming assets, strengthened capital,
restored earnings to historic levels, and reorganized
management along functional lines.
<PAGE>
"Fleet Focus '94 was a thoughtful, reasoned examination of
activities performed in all areas of our banking franchise, and
it uncovered important ways to restructure operations,
streamline processes and eliminate redundant activities,"
Murray said.
"We initiated this review to achieve strategic, longer-term
objectives, not in reaction to any difficulties. In fact, our
earnings last year were just under $500 million, with equally
strong prospects for the future," he said.
Implementation of approved ideas will result in the
elimination of approximately 5,500 positions, resulting in the
separation of approximately 3,000 employees, over the next 12
months. Enhanced severance arrangements will be provided to
affected employees.
"The fact that some employees will lose their jobs is a
regrettable and personally painful result of this process,"
Murray said. "However, given our intensely competitive
industry, we believe that not to have undergone this process
ultimately may well have put even more jobs at risk."
Eugene M. McQuade, executive vice president and chief
financial officer, said Fleet will record an additional expense
accrual of $25 million during the 1994 first quarter as part of
the restructuring cost. This is not expected to have any
material impact on 1994 earnings. Fleet previously accrued a
related restructuring charge of $125 million in the 1993 third
quarter.
"We are determined to make our company one of the
preeminent financial services institutions in the country,"
Murray said. "To achieve our growth and profitability
objectives through the remainder of this decade, it was
necessary for us to review and revise our infrastructure and
work processes so we can better control costs and compete
aggressively."
Fleet launched Fleet Focus '94 in August 1993 to review all
of its operating policies and procedures. The seven-month
review impacted every department and division in Fleet's
banking operations and included the participation of virtually
every employee.
Murray termed the project "essential for Fleet's future.
It represents a fundamental change in the way we will conduct
business and how we will run this company in the coming years."
<PAGE>
"Employees surfaced more than 20,000 ideas about how Fleet
might reduce costs, simplify procedures, redesign work
processes, enhance fee income, and restructure organizationally
to position the company for future growth opportunities,"
Murray said.
Fleet's management has approved more than 3,000 of the
ideas, which will be implemented over the next 12 months,
commencing in the second quarter. Many of the cost-saving and
revenue-enhancing ideas will cut across the entire corporation,
while others will be localized to particular divisions,
departments or other groups within the company, Murray said.
Numbering more than 2,600 cost-saving ideas and
approximately 400 that will enhance revenue, the ideas are
classified into seven broad categories ranging from process
redesign to centralization and consolidation.
"Process redesign" and "automation," for example, involved
more than one-third, or 950, of cost-savings ideas and nearly
one-half of the total savings; they deal with changing how work
is done on a day-to-day basis. Other savings categories
included "centralization and consolidation" and "vendor
management," which together incorporated about 250 ideas.
Additional savings will come from policy changes,
standardization and general efficiencies.
The 400 revenue-enhancing ideas are expected to generate
more than $50 million annually in additional income for Fleet.
Schedules of fees and charges for various banking services will
be more uniformly applied. For example, fewer waivers of
service fees and charges will occur. In addition, some new
pricing points will be established and existing ones
strengthened.
Murray said, "The idea generation process involved
employees from every level of the company and is one reason why
our review, while intensive, has been unlike most other
corporate restructuring efforts. It's also unique because we
undertook the review process from a position of strength,
without impacting the momentum of our business or endangering
our profitibility."
"I am particularly proud of the thousands of Fleet
employees who contributed so much to this process," Murray
said. "It has been very demanding, and they responded with
extraordinary interest and energy."
Fleet Focus '94 was carried out in partnership with Tandon
Capital Associates, a New York-based financial advisory firm.
<PAGE>
Fleet Financial Group is a $48-billion diversified
financial services company listed on the New York Stock
Exchange (NYSE-FLT) with approximately 1,200 offices
nationwide. Its lines of business include commercial and
consumer banking, mortgage banking, consumer finance,
asset-based lending, equipment leasing, investment management,
and student loan processing.
(See attached Fleet Focus '94 Fact Sheet)
